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Finance / July 19, 2018 / Isabella Mccray

Equity is the value of the business left to its owners after the business has paid all liabilities. Sometimes, there are different classes of ownership units, such as common stock and preferred stock. Total equity is what is left over after you subtract the value of all the liabilities of a company from the value of all of its assets. Equity is reported on a company's balance sheet.

Debt to Total Asset Ratio is a ratio to determine the extent of leverage in a company. This ratio makes it easy to compare the levels of leverage in different companies. Debt to Total Asset Ratio is a very important ratio in the ratio analysis. The article clarifies how we can analyze this ratio and interpret it to use it for making important financial decisions.

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