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Calculate Debt-equity Ratio Total Assets Total Debts Current Liabilities - CBSE (Arts) Class 12 - Accountancy

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Question

Calculate Debt-Equity Ratio

Particulars Rs
Total Assets 3,50,000
Total Debts 2,50,000
Current Liabilities 80,000

Solution

Debt-Equity Ratio = `"Debts"/"Equity"`

Debts = Total Debts - Current Liabilities

= 2,50,000 - 80,000

= 1,70,000

Equity = Total Assets - Total Debts

= 350000 - 250000

= 10000

Debt Equity Ratio = "Debt"/"Equity" = `170000/100000 = 1.7:1`

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Solution Calculate Debt-equity Ratio Total Assets Total Debts Current Liabilities Concept: Solvency Ratios - Debt to Equity Ratio.
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