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State with reason, whether the Proprietary Ratio will improve, decline or will not change because of the following transactions if Proprietary Ratio is 0.8 : 1:(i) Obtained a loan of ₹ 5,00,000 from State Bank of India payable after five years.(ii) Purchased machinery of ₹ 2,00,000 by cheque.(iii) Redeemed 7% Redeemable Preference Shares ₹ 3,00,000.(iv) Issued equity shares to the vendor of building purchased for ₹ 7,00,000.(v) Redeemed 10% redeemable debentures of ₹ 6,00,000. |
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Answer» State with reason, whether the Proprietary Ratio will improve, decline or will not change because of the following transactions if Proprietary Ratio is 0.8 : 1: (i) Obtained a loan of ₹ 5,00,000 from State Bank of India payable after five years. (ii) Purchased machinery of ₹ 2,00,000 by cheque. (iii) Redeemed 7% Redeemable Preference Shares ₹ 3,00,000. (iv) Issued equity shares to the vendor of building purchased for ₹ 7,00,000. (v) Redeemed 10% redeemable debentures of ₹ 6,00,000. |
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