Question 25 Chapter 4 of +2-B – USHA Publication 12 Class

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:

Particular Note 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

  • Chapter No. 1 – Accounting Not for Profit Organisations

  • Chapter No. 2 – Partnership Accounts – I

  • Chapter No. 3 – Partnership Accounts – II (Introduction)

  • Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

  • Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

  • Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

  • Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

  • Chapter No. 8 – Company Accounts (Share Capital)

  • Chapter No. 9 – Company Accounts (Issue of Debentures)

  • Chapter No. 10 – Company Accounts (Redemption of Debentures

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

  • Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

  • Chapter No. 2 – Techniques of Financial Statement Analysis

  • Chapter No. 3 – Ratio Analysis 

  • Chapter No. 4 – Cash Flow Statement

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

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