Forums›ACCA Forums›gearing ratio(debt:Equity)ACCA ForumsAFMgearing ratio(debt:Equity)RRosemary9y agoIf a question says gearing ratio(debt:equity) is 0.6 does it mean debt is 60 and equity is 40 or debt is 60 and equity is 100John MoffatTutor9y ago#1Debt 60 and equity 100 (otherwise debt/equity does not equal 0.6 !!!)RRosemary9y ago#2thanksMmrjonbainModerator9y ago#3Good example of how ratio analysis generally doesn't involve ratios.In above case ratio debt to equity would be 3:2.Sign into reply to this topic.
RRosemary9y agoIf a question says gearing ratio(debt:equity) is 0.6 does it mean debt is 60 and equity is 40 or debt is 60 and equity is 100
MmrjonbainModerator9y ago#3Good example of how ratio analysis generally doesn't involve ratios.In above case ratio debt to equity would be 3:2.
9y ago#1