Just a comment - - Maybe obvious, but for some reason I was doing this in a much more complicated way than just recently. If D/E = .3, then A/E will be (D/E + 1) = 1.3 Proof: A/E = (D + E) / E (D + E) / E = 1 + (D/E)
here’s an easier way. Just realize that “balance sheets balance”. Example - D/E = 0.3 ==> Set E to 1. THerefore, D=0.3 ==> A = 1+0.3 = 1.3 ==> A/e = 1.3/0.3 You can use this to go between Debt Ratio, A/E and D/E. It’s low tech, but useful if you suffer from total brain lockup during the exam.