Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Accounting Ratios

Question:

Proprietory Ratio indicates the relationship between the proprietor’s funds and….....

Options:

Reserve

Debentures

Share Capital

Total Assets

Correct Answer:

Total Assets

Explanation:

Proprietary ratio expresses relationship of proprietor’s (shareholders) funds to net assets and is calculated as follows :
Proprietary Ratio = Shareholders’, Funds/Capital employed (or net assets)