Practicing Success
There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the options given below. Assertion (A): Proprietary Ratio shows the proprietor funds invested in total assets. |
Both, Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A). Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of Assertion (A). Assertion (A) is not correct but the Reason (R) is correct. Only Assertion (A) is correct. |
Both, Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A). |
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). |