Explain the funded debt to total capitalization ratio, Managerial Accounting

Assignment Help:

Funded debt to total capitalization ratio

The ratio establishes a link among the long term funds raised from outsider and total long term funds available in the business. The two words used in this ratio are 1) funded debt and 2) total capitalization.

Though there is no rule of thumb but still the lesser the reliance on outsider the better it will be. If this ratio is smaller better it will be upto 50% or 55% this ratio may be too tolerable and not beyond.

The ratio of 18.18% is quite low. The company has not relied much on outside sources for raising long term funds. There is enough scope for the company to raise long term loans from outsiders.

 


Related Discussions:- Explain the funded debt to total capitalization ratio

Financial accounting , Financial Accounting Which is concerned with th...

Financial Accounting Which is concerned with the provision of information to external parties outside the organization? It is the procedure of measuring, classifying, summariz

Define activities based costing by horngren, Define Activities based costin...

Define Activities based costing by horngren According to horngren " ABC is a system that focuses on activities as fundamental cost object and utilizes cost of these activi

Collection float, Collection float considers to the gap among the times, pa...

Collection float considers to the gap among the times, payment is made through the customer/debtor and the time while funds are obtainable for use in the company's bank account. In

Monitoring receivables, A firm requires continuously monitoring and control...

A firm requires continuously monitoring and controlling its receivables to make sure that the dues are paid on the due date and no dues stay outstanding for a long period of time.

What is master budget, What is Master budget Financial budget are conce...

What is Master budget Financial budget are concerned with cash receipts and disbursements working capital. Several functional budgets are integrated into master budget. This bu

Illustration of optimum cash balance, M/s Sunrise Industries estimates its ...

M/s Sunrise Industries estimates its net cash requirement at Rs. 20 million for the subsequent year. Opportunity cost fund is 15 percent per annum of the Companies. The company wil

How much was Topaz’s operating income (income before taxes), How much was T...

How much was Topaz’s operating income (income before taxes) last year?

CPM @ pert, 2. Draw the network diagram for the following problem and indi...

2. Draw the network diagram for the following problem and indicate a sequence of plans that the company should want to consider in making a time-cost tradeoff. The company is not

Cost, Stellar Packaging Products and its primary customer, Estrella Coffee,...

Stellar Packaging Products and its primary customer, Estrella Coffee, are deciding on appropriate costing systems for their operations. Stellar Packaging Products’ manufacturing is

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd