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Question
Total Debt ₹12,00,000; Current Liabilities ₹4,00,000; Capital Employed ₹`12,00,000. Calculate Total Assets to Debt Ratio.
Sum
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Solution
Debt = Total Debt - Current Liabilities
= 1200000 - 400000 = Rs 800000
Total Assets = Capital Employed + Current Liabilities
= 1200000 + 400000 = Rs 1600000
Total Assets to Debt Ratio
= `"Total Assets"/"Debt" = 1600000/800000 = 2 : 1`
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