Enter the total amount of debt ($) and the total value of assets, capital, or equity ($) into the Leverage Ratio Calculator. The calculator will evaluate and display the Leverage Ratio.

## Leverage Ratio Formula

The following formula is used to calculate the Leverage Ratio.

LR = D / AV

• Where LR is the Leverage Ratio ($/$)
• D is the total amount of debt ($) • AV is the total value of assets, capital, or equity ($)

## How to Calculate Leverage Ratio?

The following example problems outline how to calculate Leverage Ratio.

Example Problem #1:

1. First, determine the total amount of debt ($). • The total amount of debt ($) is given as: 10,000.
2. Next, determine the total value of assets, capital, or equity ($). • The total value of assets, capital, or equity ($) is provided as: 20,000.
3. Finally, calculate the Leverage Ratio using the equation above:

LR = D / AV

The values given above are inserted into the equation below and the solution is calculated:

LR = 10,000 / 20,000 = .50 ($/$)

Example Problem #2:

For this problem, the variables required are provided below:

total amount of debt ($) = 13,000 total value of assets, capital, or equity ($) = 30,000