# Equity Ratio Calculator

Equity Ratio Calculator is a tool that calculates the equity ratio dividing total equity by total assets

Equity Ratio:
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Background Information

What does Equity Ratio mean?
The Equity Ratio is an investment leverage or solvency ratio that measures the number of assets that are financed by owners’ investments by comparing the total equity in the company to the total assets.
Formula
Equity Ratio = Owners Equity / Total Assets
Example
For example, ABC International has total equity of $500,000 and total assets of$750,000. On applying the above formula it results in an equity ratio of 67% and implies that 2/3 of the company's assets were paid for with equity.