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). | ||
| + | |||
| + | Sometimes an insolvent 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== | ||
| − | *[[Bankruptcy]] | + | * [[Bankruptcy]] |
| − | *[[Conservatorship]] | + | * [[Conservatorship]] |
== External links == | == External links == | ||
| − | |||
*[http://dictionary.law.com/ Law Dictionary] | *[http://dictionary.law.com/ Law Dictionary] | ||
*[http://research.lawyers.com/glossary/ Glossary of Legal Terms] | *[http://research.lawyers.com/glossary/ Glossary of Legal Terms] | ||
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[[Category:Accounting]] | [[Category:Accounting]] | ||
[[Category:Business]] | [[Category:Business]] | ||
| − | [[Category:Economics]] | + | [[Category:Economics terms]] |
[[Category:Legal Terms]] | [[Category:Legal Terms]] | ||
Latest revision as of 21:07, January 13, 2020
Insolvent is when the total debt of an entity is greater than all of its equity (property, assets and account receivables).
Sometimes an insolvent entity can avoid a forced liquidation and/or bankruptcy if it has demonstrated an ability to maintain a positive cash flow.