Using financial ratios to predict insolvency

Avi Rushinek, Sara F. Rushinek

Research output: Contribution to journalArticlepeer-review

3 Scopus citations


The purpose of this study is to explore the feasibility of using financial ratios as an analytical technique to predict financial insolvency. Using discriminant analysis, a credit-risk score was calculated to determine if a lender should accept or reject a prospective borrower. This study reveals that 80% of the cases were correctly predicted by this model.

Original languageEnglish (US)
Pages (from-to)93-100
Number of pages8
JournalJournal of Business Research
Issue number1
StatePublished - Feb 1987

ASJC Scopus subject areas

  • Marketing


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