Debt to Assets
Short answer
Debt to assets measures what percent of your total assets are funded by debt versus equity.
Formula
Debt to Assets = Total Debt / Total Assets
Add up total debt (short-term + long-term). Divide by total assets on the balance sheet.
Why it matters
Debt to assets is a quick read on solvency. Above 60% means more than half the business is owed to creditors. Capital-intensive businesses (real estate, construction) run higher; service businesses should run lower.
Benchmarks
People also ask
Common questions about Debt to Assets
What is Debt to Assets?+
Debt to assets measures what percent of your total assets are funded by debt versus equity.
How is Debt to Assets calculated?+
Add up total debt (short-term + long-term). Divide by total assets on the balance sheet.
What is a good Debt to Assets?+
A healthy debt to assets is typically around < 30% — conservative. Specific targets vary by industry and stage; check our benchmarks above for your sector.
Why does Debt to Assets matter?+
Debt to assets is a quick read on solvency. Above 60% means more than half the business is owed to creditors.
See your business's debt to assets.
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