Question

The following Balance Sheet and other information, calculate following ratios:

(i) Debt Equity Ratio (ii) Working Capital Turnover Ratio (iii) Debtors Turnover Ratio

Liabilities	Amount Rs	Assets	Amount Rs
General Reserve	80,000	Preliminary Expenses	20,000
Profit and Loss	1,20,000	Cash	1,00,000
Loan @15%	2,40,000	Stock	80,000
Bills Payable	20,000	Bills Receivables	40,000
Creditors	80,000	Debtors	1,40,000
Share Capital	2,00,000	Fixed Assets	3,60,000
	7,40,000		7,40,000

Answer 1

(i)

Debt = 15% Loan

=2,40,000

(ii) Working Capital Turnover Ratio and (iii) Debtor Turnover Ratio cannot be calculated because no information about sales is given.