On the basis of following information received from a firm its Debt Equity Ratio will be Equity Shar...........

On the basis of following information received from a firm, its Debt-Equity Ratio will be :

Equity Share Capital Rs5,80,000; Reserve Fund Rs4,30,000; Preliminary Expenses Rs40,000; Long term Debts Rs1,28,900; Debentures Rs2,30,000.

0.42 : 1

0.53 : 1

0.63 : 1

0.35 : 1

- Equity includes:

- Equity Share Capital: Rs 5,80,000

- Reserve Fund: Rs 4,30,000

- Total Equity: Rs 5,80,000 + Rs 4,30,000 = Rs 10,10,000

- Debts include:

- Long-term Debts: Rs 1,28,900

- Debentures: Rs 2,30,000

- Total Debts: Rs 1,28,900 + Rs 2,30,000 = Rs 3,58,900

- Debt-Equity Ratio = Total Debts / Total Equity:

- Rs 3,58,900 / Rs 10,10,000 = 0.3552:1, approximately.

Submit Error