Question : Total Debts Rs. 15,00,000; Current Liabilities Rs. 5,00,000; Capital Employed Rs. 15,00,000. Calculate Total Assets to Debt Ratio.
Option 1: 3:2
Option 2: 2.5:1
Option 3: 2:1
Option 4: None of the above
Answer (1)
24th Jan, 2024
Correct Answer: 2:1
Solution :
Answer =
2:1
Total assets to debt ratio=$\frac{\text {Total Asset}}{\text {Debt}}$=$\frac{20,00,000}{10,00,000}$=2:1.
Total assets = Capital employed + Current liabilities=15,00,000 + 5,00,000=20,00,000.
Long term debt= Total debt - Current liabilities=15,00,000 - 5,00,000=10,00,000.
Hence, the correct option is 3.
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