2.43 : 1
03:02
3.4 : 1.7
4.75 : 1.43
Answer is Wrong!
Answer is Right!
The correct answer is: D. 4.75 : 1.43
Solvency ratio is a measure of a company’s ability to pay off its long-term debts. It is calculated by dividing a company’s long-term assets by its long-term liabilities.
In this case, the company’s long-term assets are Rs. 1,80,000 and its long-term liabilities are Rs. 1,00,000. Therefore, the company’s solvency ratio is 1.8 : 1.
However, the question asks for the solvency ratio of the business, which includes both long-term
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