Question
Calculate Total Assets to Debt Ratio from the following:
✓
Answer
Total Assets to Debt Ratio $=\frac{\text{Total Assets}}{\text{Debt}}$
Capital Employed = Shareholder's Funds (i.e., Share Capital + Reserve and Surplus) + Long term Debts.
₹ 60,00,000= ₹ 20,00,000 + ₹ 16,00,000 + Long term Debts.
Long term Debts = ₹ 24,00,000
Total Assets = Shareholder's Funds (i.e., Share Capital + Reserve and Surplus) + Long term Debts + Current Liabilities (i.e., Trade Payables + Outstanding Exp.)
= ₹ 20,00,000 + ₹ 16,00,000 + ₹ 24,00,000 + ₹ 8,00,000 + ₹ 40,000
= ₹ 68,40,000
Total Assets to Debt Ratio $=\frac{68,40,000}{24,00,000}=2.85:1$
Capital Employed = Shareholder's Funds (i.e., Share Capital + Reserve and Surplus) + Long term Debts.
₹ 60,00,000= ₹ 20,00,000 + ₹ 16,00,000 + Long term Debts.
Long term Debts = ₹ 24,00,000
Total Assets = Shareholder's Funds (i.e., Share Capital + Reserve and Surplus) + Long term Debts + Current Liabilities (i.e., Trade Payables + Outstanding Exp.)
= ₹ 20,00,000 + ₹ 16,00,000 + ₹ 24,00,000 + ₹ 8,00,000 + ₹ 40,000
= ₹ 68,40,000
Total Assets to Debt Ratio $=\frac{68,40,000}{24,00,000}=2.85:1$
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