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Suppose a Person Starts a Business with Investment of 20 lacs Capital .e also takes 30 lacs long term loan from Bank and 10 lac Short Term Bank OD
In this case,Capital Structure is Long Term Funds Only i.e. 20+30=50 lacs out of which 20 lacs is Equity and 30 lacs is Debt
It can be said that Debt Equity Ratio of Capital Structure =Debt/Equity=30/20=3/2
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http://www.teachoo.com/3857/273/Solvency-Ratios/Balance-Sheet-Ratios/author/teachoo/
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Suppose a Person Starts a Business with Investment of 20 lacs Capital .e also takes 30 lacs long term loan from Bank and 10 lac Short Term Bank OD
In this case,Capital Structure is Long Term Funds Only i.e. 20+30=50 lacs out of which 20 lacs is Equity and 30 lacs is Debt
It can be said that Debt Equity Ratio of Capital Structure =Debt/Equity=30/20=3/2
Learn more
http://www.teachoo.com/3857/273/Solvency-Ratios/Balance-Sheet-Ratios/author/teachoo/
Comment