Home » » Use the following to answer the given question:BALANCE SHEET:$$\begin{array}{c|c} & ₦ & & ₦ \\ \hline \text{Ordinary share capital} & 100,000 & \text{Plant and Machinery} & 60,000 \\ \text{6% preference share capital} & 60,000 & Furniture & 50,000 \\ Reserve & 20,000 & \text{Motor van} & 68,000 \\ & 180,000 & Stock & 14,000 \\ \text{10% Debentures} & 40,000 & Debtors & 36,000 \\ Creditors & 25,000 & Prepyments & 1,800 \\ \text{Accrued Rent} & 3,000 & bank & 18,200 \\ Total & ₦248,000 & & ₦248,000 \end{array}$$What is the ratio pf debentures to equity?...

# Use the following to answer the given question:BALANCE SHEET:$$\begin{array}{c|c} & ₦ & & ₦ \\ \hline \text{Ordinary share capital} & 100,000 & \text{Plant and Machinery} & 60,000 \\ \text{6% preference share capital} & 60,000 & Furniture & 50,000 \\ Reserve & 20,000 & \text{Motor van} & 68,000 \\ & 180,000 & Stock & 14,000 \\ \text{10% Debentures} & 40,000 & Debtors & 36,000 \\ Creditors & 25,000 & Prepyments & 1,800 \\ \text{Accrued Rent} & 3,000 & bank & 18,200 \\ Total & ₦248,000 & & ₦248,000 \end{array}$$What is the ratio pf debentures to equity?...

### Question

Use the following to answer the given question:

BALANCE SHEET:

$$\begin{array}{c|c} & ₦ & & ₦ \\ \hline \text{Ordinary share capital} & 100,000 & \text{Plant and Machinery} & 60,000 \\ \text{6% preference share capital} & 60,000 & Furniture & 50,000 \\ Reserve & 20,000 & \text{Motor van} & 68,000 \\ & 180,000 & Stock & 14,000 \\ \text{10% Debentures} & 40,000 & Debtors & 36,000 \\ Creditors & 25,000 & Prepyments & 1,800 \\ \text{Accrued Rent} & 3,000 & bank & 18,200 \\ Total & ₦248,000 & & ₦248,000 \end{array}$$

What is the ratio pf debentures to equity?

### Options

A) 1 : 1

B) 2 : 1

C) 3 : 1

D) 5 : 2

E) 6.8 : 7

The correct answer is D.