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.
Anthony''s Orchards Consultancy report
The significant objectives of short-term cash forecast are as given: find out operating cash requirement anticipating short term financing Organization investment of
Lila Battle has determined that the annual demand for number 6 screws is 100,000 screws. Lila, who works in her brother's hardware shop, is in charge of purchasing. She estimates t
First Cut Analysis of Costs The allocation of costs and assets will produce a value chain that illustrates graphically the distribution of a firm's costs. It can prove reveali
Barker Company has a single product called a Zet. The company normally produces and sells 80,000 Zets each year at a selling price of $40 per unit. The company’s unit costs at this
Alternative performance measures There are various measures that can be used to measure performance of a decentralized company. The major ones are: • Return on Investmen
Laplace Criterion of Rationality This criterion holds that if decision makers do not know the probabilities of the various states of nature and have no reason to think otherwis
State the price determination under the market condition The price determination under the following market condition is as follows: 1) Pure competition: in this situation
bases of classifying budgets
Markov Properties 1) Transition probabilities are dependent only on the current state of the system i.e. provided that the current state is recognized; the conditional probabil
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