Calculate the Proprietary Ratio from the following information: Share Capital = ₹5,00,000 Non-Current Assets = ₹22,00,000 Reserves and Surplus = ₹3,00,000 Current Assets = ₹10,00,000.
Options:
100%
25%
70%
40%
Correct Answer:
25%
Explanation:
Proprietary Ratio = \(\frac{\text{shareholder's funds}}{\text{capital employed}}\) x 100 = [(500000 + 300000)/ (2200000 + 1000000)] X 100 = (800000/ 3200000) X 100 = (1/4) X 100 = 25%