T wants to have a 50 : 50 mix in his portfolio between equity and debt. He started off with an investment of Rs 1 lakh each in equity and debt. In the first year equity gained by 10% while debt rose 5%. At the end of the first year if the portfolio has to be rebalanced then what action needs to be taken

You operate in a perfect capital market in which firms and individuals can borrow or lend as much as they like at 8% p.a. You have currently invested in XYZ Ltd which is unlevered and generates a return of 14% p.a. on average. If XYZ restructured to a 50/50 mix of debt/equity, what return on their investment would equity holders require to invest?A.The return on equity will increase to 20%.B.The return on equity will be unchanged because the amount of debt raised is insufficient to substantially increase the risk of financial distress.C.The return on equity will be 11% since half the firm is financed by equity (which costs 14%) and half is financed by debt (which costs 8%).D.The return on equity is 8%.

Owner has used a stock Rs. 10,000 and cash Rs. 3000 for his personnel usage.07. Investment income received is Rs. 1200008. PPE should be depreciated 12% per annum09. Paid bank loan installment is Rs. 25000 and included interest for above is Rs. 500010. Received Rs 27000 from debtors under a discount of 10%11. Set off a debtor worth of Rs. 53000 with a creditor of Rs.50,000Required01. Write the transaction could be occurred from the 01-0502. Show the impact of transactions 6 -11 with in the accounting equation and state whether eachvalue increase (+) decrease (-) and in front of the value. (use following format.)TransactionNoncurrentassetsStock Tradereceivables CashEquity TradePayablesOtherPayablesCapital RetainedEarnings1.2.........TransactionNoncurrentassetsStock Tradereceivables CashEquity TradepayablesOtherpayablesCapital Retainedprofit01/01Balance 500 80 60 360 725 - 155 12001 +200 -110 +9002 -36 +4 -4003 -100 +150 +5004 +30 -3005 +20 -30 -10303. Prepare the income statement for the year ending 31.01.201904. Prepare the statement of Financial position as at 31.01.2019

Investment $10,000,000 ROCE 10% Market rate of return 17% Debt Equity 0 1 1 1 2 1 3 1

Debt-Equity Ratio 2:1, Net Profit (after Tax) Ratio 16.8%, Operating Profit Ratio 30%. Operating Expenses Ratio 100%t Inventory Velocity 1 month, Tax Rate 30%, Land & Building 6,75,000, Plant & Machinery 6,00,000, Capital Work-in-Progress 3,00,000. Inventory (Including Raw Materials 15,000, Work-in-Progress 20,000 and Stores and Spares ₹ 5,000) ₹ 1,40,000. Trade Receivables 2,20,000, Provision for doubtful debts 20,000. Credit Sales are 2,00,000 more than Cash Sales. Calculate Interest Coverage Ratio, Trade Receivables Turnover Return on Investment.

Question 8If a company has $30,000 debt and $60,000 equity, what is its debt to equity ratio?