Assuming That the Debt to Equity Ratio is 2 : 1, state giving reasons, which of the following transactions would (i) increase; (ii) Decrease; (iii) Not alter Debt to Equity Ratio:(i) Issue of new shares for cash.(ii) Conversion of debentures into equity shares(iii) Sale of a fixed asset at profit.(iv) Purchase of a fixed asset on long-term deferred payment basis.(v) Payment to creditors.

Assuming That the Debt to Equity Ratio is 2 : 1, state giving reasons,

1.	Assuming That the Debt to Equity Ratio is 2 : 1, state giving reasons, which of the following transactions would (i) increase; (ii) Decrease; (iii) Not alter Debt to Equity Ratio:(i) Issue of new shares for cash.(ii) Conversion of debentures into equity shares(iii) Sale of a fixed asset at profit.(iv) Purchase of a fixed asset on long-term deferred payment basis.(v) Payment to creditors.
Answer» Assuming That the Debt to Equity Ratio is 2 : 1, state giving reasons, which of the following transactions would (i) increase; (ii) Decrease; (iii) Not alter Debt to Equity Ratio: (i) Issue of new shares for cash. (ii) Conversion of debentures into equity shares (iii) Sale of a fixed asset at profit. (iv) Purchase of a fixed asset on long-term deferred payment basis. (v) Payment to creditors.

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