Solvency.

Solvency is the ability of a company to pay off all obligations (short-term debt and long-term debt) if the company is at one time closed or liquidated. Solvency can also be interpreted as a comparison between the total amount of assets or wealth with the total amount of debt-
company debt at the time the company was sold. Solvency is a comparison between all own capital and the total amount of a company's debts. A company can be said to be solvable if in the final calculation between the amount of assets / own capital exceeds the amount of its debts, it means that all of its obligations can be paid off. There are several factors that cause a company to be liquidated, stopped operating or closed, namely:

- Running out of raw materials, is the supply or supply of raw materials for the company's production is insufficient or completely exhausted. For example mining companies, wood processing companies and so on.

- Mismanagement (eg management), for example the company in its journey has earned sufficient profits, profits should be used to develop the company and the expansion of the company, but what happens is the profits obtained are used by leaders or certain elements in the company enrich themselves or not for the benefit company.

- Internal company conflict occurred; between owner and owner, between owner and leader, between leader and worker and so on. If the company is owned by two people or more vulnerable to conflict, especially in the implementation of policies, the imposition of interests, ideas, ideas, power struggles and so on so as to disrupt the course of the company.

- Losing in product competition, this can happen if a company does not pay enough attention to what consumers need in the market, both in model, design, quality, taste, service and so on, then the research and development or innovation of the product does not run over time.

- Contrary to the interests of the community and applicable laws. This can occur if the company's operations cause unrest, community discomfort, such as production waste, noise, air pollution or in the licensing that is not in accordance with the reality of the company.