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Gearing ratio

NNikita5y ago
Hello Sir, I wanted to confirm do we take Bank overdraft in Debt or not ? and if so why .. Because as per my understanding Bank overdraft should be included in Current liabilities. Thanks in advance!
John MoffatJohn MoffatTutor5y ago#1
We do not include it (unless the question implies that the intention is to maintain in for the long-term, in which case it would be regarded as long-term debt for the purposes of the gearing ratio).
NNikita5y ago#2
Alright! Thank you sir
John MoffatJohn MoffatTutor5y ago#3
You are welcome :-)
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