Solution for Q 51 to 60 of Chapter 4 of Book 3 - Analysis of Financial Statements of T S Grewal Class 12 Accountancy 2026-27 are given below. The Chapter name is Ratio Analysis class 12. These Solutions are based on topics solvency ratios which includes total assets to debt ratio and proprietary ratio.
Working notes are given with each solution. These help in understanding the steps and are also important for board exams as marks are given for steps.Debt equity ratio is a key ratio is finfing the long term solvency of any business and is critical business health parameter. A higher debt equity ratio is generally considered unhealthy for business as it indicates higher dependency on external funds and future solvency problems may arise.
These solutions are also useful for CA Foundation, CS Foundation and CMA Foundation students. The solutions will be helpful for students as well as teachers teaching class 12 accounts.
Question 51
| Total Assets | = | 770000 | ||
| Long term Debts | = | 400000 | ||
| Total Assets | = | Total Assets | / | Long Term Debts |
| 770000 | / | 400000 | ||
| = | 1.925:1 |
▶ Video Solution: Coming Soon
Question 52
| Step 1 | ||||
| Capital Employed | = | Shareholders | + | Long Term |
| Funds | Debts | |||
| So if we add current liabilities also to capital employed then | ||||||
| we will get total liabilities which in turn is equal to total assets |
| Total Liabilities | = | Capital Employed | + | Current Liabilities |
| 600000 | + | 200000 | ||
| = | 800000 | |||
| Step 2 | ||||
| Total Assets | = | Total Liabilities | ||
| 800000 | ||||
| Step 3 | ||||
| Long Term Debts | = | Total Debt | - | Current Liabilities |
| 600000 | 200000 | |||
| = | 400000 | |||
| Step 4 | ||||
| Total Assets | = | Total Assets | / | Long Term Debts |
| 800000 | / | 400000 | ||
| = | 2:1 | |||
▶ Video Solution: Coming Soon
Question 53
| Step 1 | ||||
| Long term Debts | = | Total Debts | - | Current Liabilities |
| 360000 | - | 40000 | ||
| = | 320000 | |||
| Step 2 | ||||
| Total Liabilities | = | Shareholder's Funds | + | Total Debts |
| 160000 | + | 360000 | ||
| = | 520000 | |||
| Step 3 | ||||
| Total Assets | = | Total Liabilities | ||
| 520000 | ||||
| Step 4 | ||||
| Total Assets | = | Total Assets | / | Long Term Debts |
| to Debt Ratio | ||||
| 520000 | / | 320000 | ||
| = | 1.625:1 | |||
▶ Video Solution: Coming Soon
Question 54
| Step 1 | |||||
| Total Liabilities | = | Shareholder's Funds | + | Total Debts | |
| 1000000 | + | 6000000 | |||
| = | 7000000 | ||||
| Step 2 | |||||
| Total Assets | = | Total Liabilities | |||
| 7000000 | |||||
| Step 3 | |||||
| Working Capital | = | Current Assets | - | Current Liabilities | |
| So | |||||
| Current Liabilities | = | Current Assets | - | Working Capital | |
| 2500000 | - | 500000 | |||
| Current Liabilities | = | 2000000 | |||
| Step 4 | |||||
| Long Term Debts | = | Total Debts | - | Current Liabilities | |
| NCL | 6000000 | - | 2000000 | ||
| = | 4000000 | ||||
| Step 5 | |||||
| Total Assets | = | Total Assets | / | Long Term Debts | |
| to Debt Ratio | |||||
| 7000000 | / | 4000000 | |||
| = | 1.75:1 | ||||
▶ Video Solution: Coming Soon
Question 55
| Step 1 | |||||
| Total | = | Total | + | Shareholderrs | |
| Liabilities | Debt | Funds | |||
| = | 1200000 | + | 200000 | ||
| = | 1400000 | ||||
| Step 2 | |||||
| Total | = | Total | |||
| Assets | Liabilities | ||||
| = | 1400000 | ||||
| Step 3 | |||||
| Working | = | Current | - | Current | |
| Capital | Assets | Liabilities | |||
| 100000 | = | 500000 | - | CL | |
| CL | = | 500000 | - | 100000 | |
| = | 400000 | ||||
| Step 4 | |||||
| Long Term | = | Total | - | Current | |
| Debts | Debts | Liabilities | |||
| = | 1200000 | - | 400000 | ||
| = | 800000 | ||||
| Step 5 | |||||
| Total Assets | = | Total Assets | / | Long Term Debts | |
| to Debt Ratio | |||||
| 1400000 | / | 800000 | |||
| = | 1.75:1 | ||||
| Note : Reserves and Surplus is already included in | |||||
| Shareholder Funds and hence not considered separately |
▶ Video Solution: Coming Soon
Question 56
| Step 1 | ||||||||||
| Total | = | Shareholderrs | + | 9% Long term | + | 10% Debentures | + | CL | ||
| Liabilities | Funds | Bank Loan | ||||||||
| = | 1500000 | + | 100000 | + | 400000 | + | 500000 | |||
| = | 2500000 | |||||||||
| Step 2 | ||||||||||
| Total | = | Total | ||||||||
| Assets | Liabilities | |||||||||
| = | 2500000 | |||||||||
| Step 3 | ||||||||||
| Debt | = | 9% Long term | + | 10% Debentures | ||||||
| Bank Loan | ||||||||||
| = | 100000 | + | 400000 | |||||||
| = | 500000 | |||||||||
| Step 4 | ||||||||||
| Total Assets | = | Total Assets | / | Long Term Debts | ||||||
| to Debt Ratio | = | |||||||||
| 2500000 | / | 500000 | ||||||||
| = | 5:1 | |||||||||
▶ Video Solution: Coming Soon
Question 57
| Step 1 | |||||||
| Total Liabilities | = | Shareholders | + | Total Debts | |||
| Funds | |||||||
| Step 2 | |||||||
| Shareholders | = | Eq Share Capital | + | Surplus | + | General Reserve | |
| Funds | 400000 | + | 100000 | + | 70000 | ||
| = | 570000 | ||||||
| Step 3 | |||||||
| Total Debts | = | Long Term | + | Current Liabilities | + | Long Term | |
| Borrowings | Provisions | ||||||
| 180000 | + | 30000 | + | 120000 | |||
| = | 330000 | ||||||
| Step 4 | |||||||
| Total Liabilities | = | Shareholders | + | Total Debts | |||
| Funds | |||||||
| 570000 | + | 330000 | |||||
| = | 900000 | ||||||
| Step 5 | |||||||
| Total Assets | = | Total Liabilities | |||||
| 900000 | |||||||
| Step 6 | |||||||
| Long Term Debts | = | Long Term | + | Long Term Provisions | |||
| Borrowings | |||||||
| 180000 | + | 120000 | |||||
| = | 300000 | ||||||
| Step 7 | |||||||
| Total Assets | = | Total Assets | / | Long Term Debts | |||
| to Debt Ratio | |||||||
| 900000 | / | 300000 | |||||
| = | 3:1 | ||||||
▶ Video Solution: Coming Soon
Question 58
| Step 1 | |||||||
| Net fixed Assets | = | Gross Fixed | - | Accumulated | |||
| Assets | Depreciation | ||||||
| 600000 | - | 100000 | |||||
| = | 500000 | ||||||
| Step 2 | |||||||
| Total Non | = | Net Fixed | + | Non Current | + | Long term | |
| Current Assets | Assets | Investments | Loans and advances | ||||
| 500000 | + | 10000 | + | 40000 | |||
| = | 550000 | ||||||
| Step 3 | |||||||
| Total Assets | = | Non | + | Current Assets | |||
| Current Assets | |||||||
| 550000 | + | 250000 | |||||
| = | 800000 | ||||||
| Step 4 | |||||||
| Long Term Debt | = | Long Term | + | Long Term Provisions | |||
| Borrowings | |||||||
| 300000 | + | 100000 | |||||
| = | 400000 | ||||||
| Step 5 | |||||||
| Total Assets | = | Total Assets | / | Long Term Debts | |||
| to Debt Ratio | |||||||
| = | 800000 | / | 400000 | ||||
| = | 2:1 | ||||||
▶ Video Solution: Coming Soon
Question 59
| Step 1 | ||||
| Shareholders | = | Share Capital | + | Reserves and Surplus |
| Funds | 300000 | + | 180000 | |
| = | 480000 | |||
| Step 2 | ||||
| Total Assets | = | Non Current Assets | + | Current Assets |
| 1320000 | + | 600000 | ||
| = | 1920000 | |||
| Step 3 | ||||
| Proprietary Ratio | = | Shareholders Funds | / | Total Assets |
| = | 480000 | 1920000 | ||
| = | 0.25:1 |
▶ Video Solution: Coming Soon
Question 60
| Step 1 | ||||||
| Shareholders | = | Share Capital | + | Reserves and Surplus | ||
| Funds | 770000 | + | 65000 | |||
| = | 835000 | |||||
| Step 2 | ||||||
| Total Assets | = | Fixed Assets | + | Trade Investment | + | Current Assets |
| 700000 | + | 245000 | + | 300000 | ||
| = | 1245000 | |||||
| Step 3 | ||||||
| Proprietary Ratio | = | Shareholders Funds | / | Total Assets | ||
| 835000 | 1245000 | |||||
| = | 0.67:1 | |||||
| Note : Trade investments are assumed to be non current |
▶ Video Solution: Coming Soon