Question : Fixed assets Rs.500000; Current assets Rs.300000; Equity share capital Rs. 400000; Reserves Rs.200000; Long term debt Rs.40000. Proprietory ratio will be -
Option 1: 75%
Option 2: 80%
Option 3: 133%
Option 4: 85%

Question

Question : Fixed assets Rs.500000; Current assets Rs.300000; Equity share capital Rs. 400000; Reserves Rs.200000; Long term debt Rs.40000. Proprietory ratio will be -

Option 1: 75%

Option 2: 80%

Option 3: 133%

Option 4: 85%

Team Careers360 · Accepted Answer

Correct Answer: 75%

Solution : The shareholders equity is divided by the total assets of the company to arrive at the proprietary ratio, which is expressed as a percentage.

Total shareholder euity is - Equity share capital + Reserves

= 400000 + 200000 = 600000

Total assets of the company = Fixed assets + Current assets

= 500000 + 300000

= 800000

Hence the Proprietory ratio is - 600000*100 / 800000

= 75%

Hence the correct answer is option 1.

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Question : Fixed assets Rs.500000; Current assets Rs.300000; Equity share capital Rs. 400000; Reserves Rs.200000; Long term debt Rs.40000. Proprietory ratio will be - Option 1: 75%Option 2: 80%Option 3: 133%Option 4: 85%

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Question : Fixed assets Rs.500000; Current assets Rs.300000; Equity share capital Rs. 400000; Reserves Rs.200000; Long term debt Rs.40000. Proprietory ratio will be -
Option 1: 75%
Option 2: 80%
Option 3: 133%
Option 4: 85%