🏗️Solvency Ratios
Debt-to-Equity Ratio
Total Liabilities ÷ Total Equity = Debt-to-Equity Ratio
What It Means
For every $1 of equity, how much debt do you have?
Example
Total Liabilities:$300,000
Total Equity:$200,000
$300,000 ÷ $200,000
Debt-to-Equity = 1.5
→ $1.50 of debt for every $1 of equity
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