Insert the information in the form and the calculator will determine the equity ratio.


What is the equity ratio?


The equity ratio is a financial ratio that indicates the relative proportion of the equity that is used to finance a company's assets.


How to calculate equity ratio?


To calculate equity ratio you should use the following formula:
equity ratio = total shareholders equity / total assets


example: company x's total assets are $94,000 and the total shareholder equity of the company is $37,000, calculate the equity ratio?


Using the equity ratio formula the asnwer will be:

equity ratio = total shareholders equity / total assets
equity ratio = $37,000 / $94,000
equity ratio = 0.39


Why use equity ratio?


the equity ratio is used because it tells how much of the company's assets are funded by issuing stock and not by borrowing. It is also an indicator of a firm's financial stability in the long run.


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Gordon Growth Model

It's a calculation of a firm's intrinsic value assuming that it's shares are worth the sum of it's future dividends discounted back to their present value.

Gross Scheduled Income

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Inventory Turnover Ratio

It's a financial ratio that measures the ability of a company to efficiently manage it's stock of goods.

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