solution 44 of Accounting Ratios TS Grewal Edition 2025 | Debt to Equity Ratio

Описание: solution 44 of Accounting Ratios TS Grewal Edition 2025 | Debt to Equity Ratio

40. Calculate Debt to Equity Ratio from the following information:

Particulars ₹

Property, Plant and Equipment (Gross) 8,40,000
Accumulated Depreciation 1,40,000
Non-current Investments 80,000
Long-term Loans and Advances 56,000
Current Assets 3,50,000
Current Liabilities 2,80,000
10% Long-term Borrowings 4,00,000
Long-term Provisions 1,40,000


(Ans: Debt to Equity Ratio = 1 : 1)


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41. From the following information, calculate Debt to Equity Ratio:
Total Debts ₹ 6,00,000; Current Liabilities ₹ 2,00,000 and Capital Employed ₹ 6,00,000.
(Ans: Debt to Equity Ratio = 1 : 1)


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42. Calculate Debt to Equity Ratio: Total Assets ₹ 14,00,000; Total Debt ₹ 12,00,000; Capital Employed ₹ 10,00,000.
(Ans: Debt to Equity Ratio = 3 : 1)


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43. Capital Employed ₹ 8,00,000; Shareholders’ Funds ₹ 2,00,000. Calculate Debt to Equity Ratio.
(Ans: Debt to Equity Ratio = 3 : 1)


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44. King Ltd. has Current Ratio of 2.5 : 1. Its Working Capital is ₹ 1,20,000. Total Assets are ₹ 3,80,000 and Total Debt of ₹ 2,80,000.
Calculate Debt to Equity Ratio.
(Ans: Debt to Equity Ratio = 1 : 1)


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45. Monica Ltd. has Quick Ratio of 1.5 : 1. Its Working Capital is ₹ 1,20,000. Total Assets ₹ 3,80,000 and Total Debts ₹ 2,80,000. Inventories ₹ 80,000. Calculate Debt to Equity Ratio.
(Ans: Debt to Equity Ratio = 2 : 1)


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46. When Debt to Equity Ratio is 2, state, giving reason, whether this ratio will increase, decrease or have no change in each of the following cases:
(i) Issue of equity shares of ₹ 4,00,000 for ₹ 5,00,000;
(ii) Issue of equity shares for the purchase of Plant and Machinery worth ₹ 10,00,000;
(iii) Issue of Preference Shares for redemption of 13% Debentures, worth ₹ 10,00,000.
(Ans: (i) Decrease; (ii) Decrease; (iii) Decrease)


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47. Debt to Equity Ratio of a company is 0.5 : 1. Which of the following would increase, decrease or not change it:
(i) Issue of Equity Shares;
(ii) Redemption of Debentures;
(iii) Cash received from debtors;
(iv) Purchased goods on credit.
(Ans: (i) Decrease; (ii) Decrease; (iii) No Change; (iv) No Change)


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48. Balance Sheet had the following amounts as at 31st March, 2025:

Particulars ₹

10% Preference Share Capital 5,00,000
Equity Share Capital 15,00,000
Securities Premium Reserve 1,00,000
Reserves and Surplus 4,00,000
Long-term Loan from IDBI @9% 30,00,000
Current Assets 12,00,000
Current Liabilities 8,00,000
Investments (in other companies) 2,00,000
Property, Plant and Equipment – Cost 40,00,000
Depreciation Written off 14,00,000


Calculate ratios indicating the Long-term and Short-term financial position of the company.
(Ans: Debt to Equity Ratio = 1.25 : 1; Current Ratio = 1.5 : 1)


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49. Assuming that the Debt to Equity Ratio is 2 : 1, state, giving reasons, which of the following transactions would (i) Increase; (ii) Decrease; (iii) Not alter Debt to Equity Ratio:
(i) Issue of new shares for cash.
(ii) Conversion of debentures into equity shares.
(iii) Sale of a fixed asset at profit.
(iv) Purchase of a fixed asset on long-term deferred payment basis.
(v) Payment to creditors.
(Ans: (i) Decrease; (ii) Decrease; (iii) Decrease; (iv) Increase; (v) No Change)