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    Question

    A firm has total assets of ₹200 lakhs, intangible

    assets worth ₹50 lakhs, current assets worth ₹60 lakhs, current liabilities of ₹40 lakhs, and total debt including preference shares of ₹80 lakhs. What is the Asset Coverage Ratio?
    A 1.10 Correct Answer Incorrect Answer
    B 1.25 Correct Answer Incorrect Answer
    C 1.38 Correct Answer Incorrect Answer
    D 1.50 Correct Answer Incorrect Answer
    E 1.75 Correct Answer Incorrect Answer

    Solution

    Given:  •  Total Assets = ₹200 lakh  •  Intangible Assets = ₹50 lakh →   So, Tangible Assets = ₹200 - ₹50 = ₹150 lakh  •  Current Liabilities = ₹40 lakh  •  Total Debt (including preference shares) = ₹80 lakh  Step-by-Step Calculation:  Answer: C. 1.38

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