Difference between revisions of "Insolvent"
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'''Insolvent''' is when the total [[debt]] of an entity is greater than all of its [[equity]] ([[property]], [[asset]]s and [[account receivable]]s). | '''Insolvent''' is when the total [[debt]] of an entity is greater than all of its [[equity]] ([[property]], [[asset]]s and [[account receivable]]s). | ||
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| + | Sometimes an entity can avoid a forced [[liquidation]] and/or [[bankruptcy]] if it has demonstrated an ability to maintain a positive [[cash flow]]. | ||
==See also== | ==See also== | ||
Revision as of 19:58, April 1, 2013
Insolvent is when the total debt of an entity is greater than all of its equity (property, assets and account receivables).
Sometimes an entity can avoid a forced liquidation and/or bankruptcy if it has demonstrated an ability to maintain a positive cash flow.
