negative net worth

negative net worth definition - business

negative net worth

An excess of liabilities over assets. If the assets are fairly valued, a firm with negative net worth could sell all its assets and then be unable to pay all its outstanding loans. Thus, nothing would remain for the owners. Also called deficit net worth.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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