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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Financial Gearing
Sir a bpp kit q no 165 is looking for financial gearing ratio using MV..they want it in the formula stats , debt/debt+equity .Bt they did not take account of ratained earnings as an equity..why ??
Again, you need to watch my free lectures where I explain this!!
The MV effectively includes retained earnings. The most obvious reason for the market value being higher than the nominal value is because there are retained earnings.
thank u sir
You are welcome 🙂