Question

(i) Current ratio: 1.5:1; (ii) Quick ratio: 1:1)
Long term solvency ratios
4. From the following information calculate debt equity ratio.
Balance Sheet (Extract) as on 31st March, 2019
Particulars
Amount
₹
I. EQUITY AND LIABILITIES
1. Shareholders' funds
(a) Share capital
Equity share capital
(b) Reserves and surplus
6,00,000
2. Non-current liabilities
2,00,000
Long-term borrowings (Debentures)
6,00,000
3. Current liabilities
(a) Trade payables
1,60,000
(b) Other current liabilities
Outstanding expenses
40,000
Total
16,00,000
(Answer: Debt equity ratio: 0.75:1)
Strom the following Balance Sheet of Sundaram Ltd. calculate proprietary ratio:
Cudoram Itd, as on 31.3.2019​

Answer 1

Answer:

Explanation:

                        DEBT EQUITY RATIO=DEBT/EQUITY

         DEBT=Long term borrowings+long term provisions

         EQUITY=Shareholder fund's+Reserve and Surplus