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Q: You are considered solvent if your assets are greater than your liabilities?
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What's the relationship between current liabilities and current assets?

Solvency. A company is considered solvent if it's current assets exceed it's current liabilities. A company is considered to be insolvent if their current liabilities exceed their current assets.


How can you tell the financial standing from assets and liabilities?

Logically, your liabilities taken away from your assets would show you your financial standing: assets - liabilities = how much money you have If your liabilities are greater than your assets, your answer will be negative and you're in debt. If your assets are greater than your liabilities, your answer will be positive and you have enough assets to get rid of your liabilities.


Can assets be greater then liabilities and owners equity?

No. Assets = Liabilities + Equity Always.


What is it called when your liabilities are greater than your total assets?

When your liabilities are greater than your total assets you are said to be "in the red." This is because negative numbers in a ledger are traditionally written in red.


When a company's liabilities exceed its assets is considered to be?

Insolvent


When a company's liabilities exceed its assets it is considered to be what?

Insolvent


What is a Solvent company?

A solvent company is one that is financially stable and able to meet its financial obligations, including payment of debts and other liabilities. A solvent company's assets typically exceed its liabilities, indicating a healthy financial position.


What are assets and liabilities reported on?

Assets and liabilities are reported on a balance sheet


Define the three components of the accounting equation?

The accounting equation is as follows: ASSETS = LIABILITIES + EQUITY


Assets equal liabilities?

Yes assets are equal to liabilities. As liabilities are source of financing either inform of equity or inform of debt. With help of liabilities (equity+debts) assets are financed.


What is the format of a balance sheet?

The format of the Balance Sheet is Assets = Liabilities + Equity * Current Assets * Fixed Assets * -------------------- * Total Assets * Current Liabilities * Long Term Liabilities * -------------------------- * Total Liabilities * Equity * Net Income * ---------------------------- * Total Equity * -------------------------- * Total Liabilities and Equity


What is a basic accounting equation?

Single proprietorship assets= liabilities + capital partnership assets= liabilities + partner's equity corporation assets= liabilities + shareholder's equity