Terms Beginning With 'l'

Long-Term Debt to Total Asset Ratio

  • January 17, 2020
  • Team Kalkine

The long-term debt to total asset ratio, which represents a company’s financial position, is used to evaluate the firm’s leverage by comparing its assets with the total debt. The ratio measures the percentage of total assets financed through long-term debt.

In other words, this ratio calculates the percentage of the assets required by a business to liquidate to settle its long-term debt.

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