Question

From the following information, calculate the Proprietary Ratio: Share Capital ₹ 5,00,000, Non-Current Assets ₹ 22,00,000, Reserves and Surplus ₹ 3,00,000, Current Assets ₹ 10,00,000.

विकल्प

• 100%

• 70%

• 40%

• 25%

Answer 1

25%

Explanation:

Given:

Share Capital = ₹ 5,00,000

Reserves and Surplus = ₹ 3,00,000

Non-Current Assets = ₹ 22,00,000

Current Assets = ₹ 10,00,000

$$\begin{aligned} \text{Shareholders' Funds} &= \text{Share Capital} + \text{Reserves and Surplus} \\ &= 5,00,000 + 3,00,000 \\ &= {₹\ 8,00,000} \end{aligned}$$ 

$$\begin{aligned} \text{Total Assets} &= \text{Non-Current Assets} + \text{Current Assets} \\ &= 22,00,000 + 10,00,000 \\ &= {₹\ 32,00,000} \end{aligned}$$ 

Now, the Proprietary Ratio formula is:
$$\begin{aligned} \text{Proprietary Ratio} &= \frac{\text{Shareholders' Funds}}{\text{Total Assets}} \times 100 \\ &= \frac{8,00,000}{32,00,000} \times 100 = {25\%} \end{aligned}$$