Which of the following ratios provides a solvency measure that shows the margin of safety of bondholders and also gives an indication of the potential ability of the business to borrow additional funds on a long-term basis?

A) ratio of fixed assets to long-term liabilities
B) asset turnover ratio
C) number of days' sales in receivables
D) return on stockholders' equity

Solvency Measure

Financial metrics used to assess a company's ability to meet its long-term obligations and its financial stability.

Fixed Assets

Long-term tangible assets that are used in the operations of a business and are not expected to be consumed or converted into cash in the short term.

Long-Term Liabilities

Financial obligations of a company not due for more than one year, including bonds payable, long-term leases, and pension obligations.