Solvency Ratios – Excel Model

Antoniya Baltova
Antoniya Baltova

Liquidity is about meeting current liabilities, while solvency refers to the ability of a firm to cover long-term liabilities. Using a firm’s Balance Sheet and Income statement, one could easily calculate a number of solvency metrics.

This is a free Excel model displaying how to calculate the following multiples:

  • Debt-to-equity
  • Debt-to-capital
  • Debt-to-assets
  • Interest coverage
  • Fixed charge coverage
  • Financial leverage

Some other related topics you might be interested to explore are Ratio analysis, Company valuation, and Forecasting.

This is an open-access Excel model in XLSX format that will be useful for anyone who wants to work as an Accountant, Financial Analyst, Finance Manager, or Investor.

You can now download the Excel template for free.

Solvency ratios are included in the Financial Reporting module of the CFA Level 1 Curriculum.