What is the formula of Debt Equity Ratio? Also define its
importance in a firm.
- 6 Answers
- 13137 Views
- ICAI, I also Faced
- E-Mail Answers
Answers were Sorted based on User's Feedback
Answer / navesh joshi
Debt Equity Ratio = Debt/Equity
Debt= Long term borrowed funds
equity= share capital+ preference share capital +
reserves&surplus - fictitious asset
the importance of this ratio is to judge the long solvency
position of a company and capital structure.
| Is This Answer Correct ? | 23 Yes | 0 No |
Answer / rahul sharma
Debt Equity Ratio = Debt/Equity
Debt= Long term borrowed funds
Equity= share capital+ preference share capital +
reserves&surplus - fictitious asset- P&L a/c dr balance.
| Is This Answer Correct ? | 4 Yes | 2 No |
Answer / harish
Total Debt/Total Equity
It indicates the financial advantage of the concern(popularly
called leverage).
| Is This Answer Correct ? | 2 Yes | 0 No |
Answer / libina kutty
DEBT EQUITY RATIO = DEBT / EQUITY
IT TELLS D TOTAL DEBT OF AN ENTITY TO ITS EQUITY . IT SHOULD
BE IN THE RATIO OF 2:1. WHICH MEANS FR EVRY 2 DEBT 1 EQUITY
SHOULD BE THEIR.
| Is This Answer Correct ? | 1 Yes | 0 No |
Answer / saurabh
debt/equity ratio:
debt :(long term debt + short term debt)
equity : (common share + pref share+ reserves and surplus)
it is used to assess the
1)riskiness
2)used by banks to check the existing composition of debt -
should be on the lower side to leave scope for more debt
| Is This Answer Correct ? | 1 Yes | 1 No |
Answer / suresh
Debt Equity Radio : Debt/Equity
Debt: Long term Loans, Overdraft , Borrowings
Equity : share Capital and preference share Capital +
Reserve and Surplus - if Any loss
| Is This Answer Correct ? | 0 Yes | 3 No |
Example for extra ordinary expenditure?
Define Salry for the following purpose 1.To calculate HRA
what do u mean by cbs???????
12 Answers State Bank Of India SBI,
what is meant by debit and credit
22 Answers DELL, i Tech, IBM, Wipro,
Expand P A N
Ram retired from partnership. The partners with mutual consent agreed to put the capital balance as on the date of retirement as loan to the firm @ 18% pa. The credit balance to his capital account was Rs 325000/- Pass necessary entry
Repaid the loan taken from Sachin for the marriage out of the business. state whether the the following transcation is business transcation or non business transcation? with reson or explaination?
what is the difference between debenture and shares
How will be prepare BRS in tally, please tell me step by step.
Expand M O U
What do mean by sales ledger and sales account
EXPAND___________NOC
Audit 
