Gearing ratio + Debentures

Discussion in 'CT2' started by Krithika, Mar 23, 2011.

  1. Krithika

    Krithika Member

    Hi,

    While calculating the company's gearing ratio, should debentures be considered under debt or not and why?

    Regards,
    Krithika
     
    Krithika, Mar 23, 2011
    #1
  2. Walrus

    Walrus Member

    Debentures are a type of (long-term, secured) debt, so yes it would be considered debt in the gearing calculation.
     
    Walrus, Mar 24, 2011
    #2

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