Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Debt equity ratio
Meaning: this ratio establishes a relationship among long term debts and share holders funds.
Objective: the objective of computing this ratio is to measure the relative proportion of debt and equity in financing the assets of a firm.
Components: there are two components of this ratio which are as under:
Long term debts: which mean long term loans (whether secured or unsecured (e.g., debentures bonds loans from financial institutions).
Shareholders funds: which mean equity share capital plus preference share capital plus reserves and surplus minus fictitious assets(e.g., preliminary expenses)
Computation: this ratio is computed by dividing the long term debts by the shareholders funds. This ratio is usually expressed as a pure ratio e.g, 2:1. in the form of a formula this ratio may be expressed as under:
Interpretation: it shows the margin of safety to long term creditors. A low debt equity ratio implies the use of more equity than debt which mean a larger safety margin for creditors since owner equity is treated as a margin of safety by creditors and vice versa.
How costs behave as the level of activity/volume changes. Why an understanding of cost behaviour is important ? Types Variable e.g. petrol, direct materials Fixed e.g.
MAKE OR BUY DECISIONS (NO LIMITING FACTORS) The choice between making and buying a given component is one which is likely to face all businesses at some time. It is often one
Pricing is a problem in four general types of situations: 1) When the firm develops or introduces a new product and it is fix the price of the product for the first time. 2)
VALUE ADDED STATEMENTS Are intended to show how much wealth or value has been created by the company’s operations and how the wealth has been shared out to interested groups e.
IF net income totaled $18,000 for one year, beginning assets were $100.000 and ending assets were $140,000, then Return on Assets for the year as a percentage will be?
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.
Recognition of the Organization's Decision Units and Decision Packages ZBB decision unit is an operating division for which decision packages are generated and analyzed. It ca
Disadvantages of the cost accounting: 1. It is unnecessary: it is argued that maintenance of the cost records is not necessary and involves duplication of work. It is based o
Assignment help
solutions for (POS) slow printing of sales tickets and unpredictable action of cash drawers. when credit approvals delayed the checkout process or when the computer was down, thus
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd