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Question
| Particulars | ₹ |
| Fixed Assets | 8,00,000 |
| Total Assets | 12,00,000 |
| Long term Borrowings | 6,00,000 |
| Long term Provisions | 2,00,000 |
| 9% Bonds | 1,00,000 |
| Trade Payables | 1,00,000 |
Total Assets to Debt Ratio will be:
Options
2.5 : 1
1.33 : 1
1.5 : 1
2.22 : 1
MCQ
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Solution
1.5 : 1
Explanation:
Long-term Debts = Long-term Borrowings + Long-term Provisions
= 6,00,000 + 2,00,000
= ₹ 8,00,000
Total Assets to Debt Ratio = `"Total Assets"/"Long term Debts"`
= `(12,00,000)/(8,00,000)`
= 1.5 : 1
Note: 9% Bonds are already included in Long-term Borrowings.
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