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Caluulote (1) Debt equity Ratio and Ini Preop metery Ratio Egraty Sh Qupiral 15,00,00 General Reserve 10,00,00 Proditep cow B
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Answer #1

(i) Debt Equity Ratio = Total Liability / Shareholder's equity

Total liabilities = Loan from ICICI +Debenture

= 7,00,000 + 10,00,000

= 17,00,000

Hence, Debt equity ratio = 21,00,000/ 24,00,000

= 0.708 =0.71

(ii) Proprietary Ratio = Proprietor's fund / Total assets

Here, proprietar's fund = Share Capital + General reserve + P&L balance

= 15,00,000 + 10,00,000 - 1,00,000

= 24,00,000

And Total assets = Current assets + Other non - current assets + Goodwill

= 18,00,000 + 22,00,000 + 500,000

= 45,00,000

Hence, Proprietary Ratio = 24,00,000 / 45,00,000

= 0.533 =0.5

NOTE : Some accountants exclude intangible assets from the total assets. If so, then total assets will be (45,00,000 - goodwill) = 40,00,000.

Proprietary ratio = 24,00,000 / 40,00,000

   = 0.6

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