Accountancy, asked by sukhi15128467, 3 months ago


The debt equity ratio of X Itd is 0.6:1. What is the effect of conversion of Debentures into 1
Preference shares on this ratio
(Increase / decrease / no change)
​

Answers

Answered by kartikgupta5478
0

Answer:

Debt to equity ratio will decrease

because debentures converted are a part of current liability as per Schedule 3 of companies act 2013. Conversion of debentures into pref shares will increase equity and there will be no change in debt so the ratio will decrease

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