What is the Leverage Ratio Calculator?

The Leverage Ratio Calculator is a financial tool that helps businesses and investors assess a company’s financial structure by comparing its total assets to total equity. By entering total assets and equity, the calculator determines the leverage ratio, showing how much of the company’s assets are financed through debt versus equity. A higher ratio indicates greater reliance on debt financing, which can increase financial risk, while a lower ratio suggests a more conservative, equity-based structure.

How to Use:

1. Enter Total Assets (PKR): Input the sum of all the company’s assets.
2. Enter Total Equity (PKR): Input the shareholders’ equity value.
3. Click “Calculate”: The calculator computes the leverage ratio.
4. Review Result: The result displays the leverage ratio along with its formula and a brief explanation of financial risk.