Internet Tool for Your Business - Debt to Net Worth
Ever borrow money for your business? When you do so, you likely get a loan packet in which you sign or initial thirty or more pages. The numbers about the loan, dollar amount, interest rate and length of the loan, are covered on just a couple of pages. A part of the middle pages are referred to as the loan covenants which is how you will provide information to the lender and what they can calculate from your financial statements.
One of the covenants frequently examined is the "debt to equity" ratio. In this ratio, they are comparing how much of the business you own and how much debt the business has. Follow this link for more information.