Question

A term loan of ₹80 crore is secured by Plant & Machinery valued at ₹90 crore and land valued at ₹30 crore. The forced sale value of machinery is assessed at 50%, while land is taken at full value. The bank wants to compute security coverage on FSV basis. What is the effective security coverage ratio?

A 0.94
B 1.05
C 1.26
D 1.47
E 1.68
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