When a company needs money to grow, it faces a fundamental choice: borrow it or raise it from investors. The Debt-to-Capital Ratio reveals exactly how that choice plays out, showing the precise balance between borrowed funds and owner-invested capital that powers every business decision. This single metric tells investors, lenders, and business owners whether a […]

Every dollar a company owns tells a story. But the real question is: how much of that dollar was borrowed? The Debt-to-Asset Ratio reveals the answer with mathematical precision. This fundamental metric shows exactly how much of a company’s assets are financed through debt versus equity. For investors seeking to understand financial risk, this ratio

When a business takes on debt, it’s making a promise. Not just to repay the principal, but to service that debt month after month, year after year, regardless of market conditions or revenue fluctuations. The question every investor, lender, and business owner must answer is simple but critical: Can this company actually keep that promise?

When a company borrows money, it doesn’t have to repay for years; that debt shapes its financial future in profound ways. Long-term liabilities represent financial obligations that extend beyond one year, and understanding them is essential for anyone learning the math behind money and building genuine financial literacy. These obligations appear on every corporate balance

When a business owner checks their bank account and sees healthy cash reserves, they might feel financially secure. But what about the invoices due next week? Are the payroll obligations coming in two days? Is the loan payment scheduled for next month? These short-term financial obligations, known as current liabilities, represent the immediate claims against

When a real estate investor in Atlanta applied for a $500,000 commercial loan in 2024, the lender asked one critical question: “What’s your DSCR?” The investor had strong credit, significant equity, and years of experience, but without understanding the Debt Service Coverage Ratio, the deal nearly fell apart. This single metric determines whether lenders approve