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4.34 Management Accounting (Section B)—ISC XII

2. From the following Balance Sheet as at 31st March, 2019 of Matrix Ltd., calculate Interest Coverage Ratio:
Particulars Note No. `
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 10,00,000
(b) Reserves and Surplus 7,50,000
2. Non-Current Liabilities
(a) Long-term Borrowings 1 12,00,000
(b) Other Long-term Liabilities 4,00,000
3. Current Liabilities
(a) Trade Payables 2,00,000
(b) Other Current Liabilities 1,00,000
(c) Short-term Provisions (Provision for Tax) 4,00,000
Total 40,50,000
II. ASSETS
1. Non-Current Assets
(a) Fixed Assets—Tangible 20,00,000
(b) Non-Current Investments 5,00,000
2. Current Assets
(a) Current Investments 5,00,000
(b) Inventories 4,00,000
(c) Trade Receivables 3,50,000
(d) Cash and Bank Balances 3,00,000
Total 40,50,000
Note to Accounts
1. Long-term Borrowings `
5,000; 10% Debentures of ` 100 each 5,00,000
Term Loan from Bank 5,00,000
Loan from Shareholders/Directors 2,00,000
12,00,000
Additional Information:
The company’s profit for the year after interest but before tax was ` 6,20,000. Provision for Tax was ` 4,00,000.
Interest on Bank Loan was ` 40,000 and that on Loan from Shareholders/Directors was ` 10,000.

3. From the following Balance Sheet of ABC Ltd. as at 31st March, 2019, calculate Debt to Equity Ratio:
BALANCE SHEET
Particulars Note No. `
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 1 10,00,000
(b) Reserves and Surplus 2 2,40,000
2. Non-Current Liabilities
(a) Long-term Borrowings 3 2,00,000
(b) Long-term Provisions 50,000
3. Current Liabilities
(a) Trade Payables 4,30,000
(b) Other Current Liabilities 20,000
(c) Short-term Provisions (Provision for Tax) 3,00,000
Total 22,40,000