Non-current Assets to Net Worth
Non-current assets to net worth ratio isa measure of the extent of a company's investment in low-liquid non-current assets. This ratio is important for comparison analysis because it is less dependent on industry (structure of company assets) than debt ratio or debt-to-equity ratio.
Non-current assets to Net Worth = Non-current assets / Net worth
Norms and Limits
An acceptable Non-current asset to Net Worth ratio is about 1-1.25 and lower, but it is still dependent on the industry. For capital-intensive industries (i.e. companies with a high share of non-current assets against current assets) the ratio may be higher.
Exact Formula in the ReadyRatios Analytic Software
Non-current asset to Net = F1[NoncurrentAssets]/ F1[Equity]
F1 – Statement of financial position (IFRS).
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