Insert the information in the form and the calculator will determine the financial leverage.


What is the financial leverage?


The financial leverage is the strategic attempt of borrowing money to invest in assets and get the return on those assets to exceed the cost of borrowing them.


How to calculate financial leverage?


To calculate financial leverage you should use the following formula:
financial leverage = total debt / shareholders equity
where:
shareholders equity = the assets that the owners of a company have invested in their business.


Why use financial leverage?


The financial leverage is used in order to increase the profitability without using additional personal capital.


Other people also used:

Fixed Charge Coverage Ratio

It's a measurement of a firm's capacity to meet fixed charge obligations such as lease expenses and interest expenses.

Gross Margin Percentage

It's the percentage of a company's revenue that is retained after direct expenses like materials and labor.

Interest Coverage Ratio

It's a measurement of a compay's ability to pay it's debt payment's.

Liquidity Ratio

It's a measurement of a firm's ability to pay it's short term obligations with it's current assets.

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