How is your Balance Sheet doing?

As an entrepreneur and with so much of our focus on profitability, it is sometimes easy to forget about our good old friend "the balance sheet".

So what if I asked you that this question... "How is your balance sheet doing?". I am not sure most people would know exactly what to answer, but here is a quick way for you to know the answer:

Check for business solvency by checking your ratio of current assets to current liabilities. 

• If that ratio is less than one, your business is in danger of going bankrupt.
• If it's less than 0.8 you are really in trouble as you are on your way to running out of cash.

So do you know now how your balance sheet is doing?