Question 25 Chapter 4 of +2-B

Question 25 Chapter 4 of +2-B

II. Solvency (Long-Term) Ratio

25. (Debt Equity Ratio) Calculate Debt Equity Ratio from the Balance Sheet of X Limited as on 31st March 2018:

ParticularNote No.
I. Equity and Liabilities   
Shareholders’ Funds  
Equity Share Capital  
80,000 Shares of ₹10 each fully paid up 8,00,000
11% Redeemable Preference Share Capital  
4,000 shares of ₹100 each fully paid up 4.00.000
Reserves and Surplus  
Securities Premium Reserve 80,000
General Reserve 5,80,000
Surplus i.e.. balance in statement of Profit and Loss 1,40,000
Non-Current Liabilities  
Long-term Borrowing :  
12% Debentures 10,00,000
10,000 Debentures of ₹100 each  
Current Liabilities   
Trade Payable 2,20,000
Outstanding Expenses 60,000
Provisions  
Provision for Taxation 2,20,000
  35,00,000
II. Assets :  
Non-Current Assets  
Tangible Assets  
Land and Building 6,20,000
Plant and Machinery 12,00,000
Furniture and Fittings 1,80,000
Current Assets  
Inventory 5,30,000
Trade Receivable 6,05,000
Cash at Bank 3,00,000
Cash in hand 65,000
  35,00,000

The solution of Question 25 Chapter 4 of +2-B: – 

Debt Equity Ratio=Debt
Shareholders Funds
Debt=12% Debentures
 =₹ 10,00,000
Shareholders Funds=Equity Share Capital + Preference Share Capital + Securities Premium Reserve + General Reserve + Balance of Statement of P&L
 =₹ 8,00,000 + ₹ 4,00,000 + ₹ 80,000 + ₹ 5,80,000 + ₹ 1,40,000
 =₹ 20,000,00
Debt Equity Ratio=₹ 10,00,000
₹ 20,00,000
   
 =1: 2



What are Liquidity Ratios – Formulas and Examples

Comment if you have any question.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 3 min 225x300 - Question 25 Chapter 4 of +2-B  - USHA Publication  12 Class
T.S. Grewal’s Analysis of Financial Statements

Leave a Reply

About us

About us, we are here to improve your knowledge in all financial & Business related topics and to get better carrier opportunities. The author has about 10-year Experience in tuition Business. It is very difficult to teach a large number of students with a personal touch or in a classroom. 

Animation's Resource websites

All Icons and images used on my website were downloaded from the following website please go and download free:-

close