How to calculate shareholders funds and debt equity ratio??

from the following calculate debt equity ratio

 

equity share capital 150000

pref. share capital 50000

general reserve 100000

accumulated profits 60000

debentures 150000

creditors 80000

expenses payable 20000

preliminary expenses not written off 10000

 

the formula is:

total debt/ shareholders funds

the answer is 3:7

 

please also show the calculation of total debt and shareholders funds.

thanks..

Replies (2)

Debt - 150000

Shareholders fund - 150000+50000+100000+60000-10000 ( fictious assests)  =350000

Debt/shareholders fund = 150000/350000= 3/7

 

Nisha's view is absolutly correct

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