Solvency measures the entitys ability to meet all its obligations when they come due. If a high

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Solvency measures the entity’s ability to meet all its obligations when they come due. If a high proportion of permanent capital is obtained from debt, rather than from equity, this increases the danger of insolvency.

The proportion of debt is indicated by the d __ r ___ .

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Essentials Of Accounting

ISBN: 9780273771463

11th International Edition

Authors: Leslie K. Breitner

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