Debt to asset ratio tells us how much of firm’s assets are financed by borrowed money.
If Debt to asset ratio is less than 1 mean that firm’s ratio is strong and stable.
Higher is this ratio greater is risk.
Formula:
Debt to asset ratio = Total Liabilities / Total Assets
Debt/Asset = (Short-term Debt + Long-term Debt) / Total Assets
Disclaimer
The information provided on Accounting Portal is for general informational and educational purposes only and does not constitute professional accounting, tax, financial, or legal advice.
While we strive for accuracy and timeliness, no representation or warranty is made regarding completeness or reliability. Always consult a qualified professional before making any business, tax, or financial decisions.
Neither Accounting Portal nor its authors are liable for any loss or damage resulting from the use of this information.
© 2025 Accounting Portal. All rights reserved.
