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      Question

      Calculate the Total Assets to Debt Ratio given the

      following information: Non-current Assets: ₹40,00,000 Current Assets: ₹40,00,000 Long-term Borrowings: ₹25,00,000 Long-term Provisions: ₹15,00,000
      A 1 : 1 Correct Answer Incorrect Answer
      B 1.5 : 1 Correct Answer Incorrect Answer
      C 2 : 1 Correct Answer Incorrect Answer
      D 2.5 : 1 Correct Answer Incorrect Answer
      E 3 : 1 Correct Answer Incorrect Answer

      Solution

      The Total Assets to Debt Ratio is calculated using the formula: Total Assets to Debt Ratio = Total Assets / Debt Total Assets = Non-current Assets + Current Assets = ₹40,00,000 + ₹40,00,000 = ₹80,00,000 Debt = Long-term Borrowings + Long-term Provisions = ₹25,00,000 + ₹15,00,000 = ₹40,00,000 Total Assets to Debt Ratio = ₹80,00,000 / ₹40,00,000 = 2 : 1

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