Divide total assets by equity to measure how much of the balance sheet is funded by debt.
The ratio divides one figure by the other and is read against a conventional benchmark of 2. Both the ratio and its percentage form are shown, because different audiences expect different presentations of the same number. A leverage ratio compresses two absolute figures into one comparable number, which is what makes it usable across companies and periods of different size.
Financial Leverage
Equity Multiplier = Total assets ÷ Shareholders equity
Equity Multiplier = Total assets ÷ Shareholders equity The ratio divides one figure by the other and is read against a conventional benchmark of 2. Both the ratio and its percentage form are shown, because different audiences expect different presentations of the same number.
A leverage ratio compresses two absolute figures into one comparable number, which is what makes it usable across companies and periods of different size.
This calculator takes 2 inputs: Total assets, Shareholders equity. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.