The debt ratio = Total debts ÷ Total assets
The Total asset amount is based on a free and clear asset value; thus the Equity value = Total asset value such as in the example and why they simply plugged in the $315 million amount?
Assets - Liabilities = Equity
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I enjoy missing three foot putts.
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Take a stab at my other questions that I posted today, if you’re of a mind to.
cpk123 used to post a lot on here, but has been gone for some time.
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No one “plugged” the $315 million for the market value of equity. The first step in deriving the market value of equity is to calculate the market value of the enterprise. That = MV of debt + the MV of equity. If the MV of debt = “10% of the value of the firm”–then the total value of the firm, including debt and equity, is $350 million. That figure is derived by dividing the market value of debt–$35 million–by the fact (given) that it “represents 10.0 % of the value of the firm.” Therfore, the value of the firm = $35 million divided by 10%, which is $350 million. The market value of equity has to be the difference between $350 million and 35 million. That difference is $315 million. I hope this is helpful.
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Very much so, thank you sir.
I have one more question that I posted in the Level 2 Equities section regarding the target debt ratio. It is an easy question, yet I’m seeking confirmation.
0.25 is the ratio of debt to equity(D/E); what you need is D + E and then calculate the weights as D/(D+E) and E/(D+E). 
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Then the “debt-to-equity ratio” should actually be titled “debt-to-Total Firm Value”?
The denominator is Total Firm Value, not Equity. A ratio is a quotient.