📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

  • google app store apple app store

    • Question

      From the following, calculate the Debt to Equity

      Ratio: Share Capital: ₹5,00,000; Reserves: ₹3,00,000; Long-term Borrowings: ₹4,00,000; Current Liabilities: ₹2,00,000.
      A 0.5:1 Correct Answer Incorrect Answer
      B 0.67:1 Correct Answer Incorrect Answer
      C 0.75:1 Correct Answer Incorrect Answer
      D 0.8:1 Correct Answer Incorrect Answer

      Solution

      Debt to Equity Ratio = Long-term Debt / Shareholders' Funds. Long-term Debt = ₹4,00,000. Shareholders' Funds = Share Capital + Reserves = 5,00,000 + 3,00,000 = ₹8,00,000. Ratio = 4,00,000 / 8,00,000 = 0.5 : 1.

      Practice Next
      ask-question