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In the Balance sheet of a firm,the debt equity ratio is2:1.The amount of long term sources is Rs. lac.What is the amount of tangible net worth of the firm?
Net worth is the surplus over assets minus liabilities other than equity, in short net worth is equal to equity. As debit equity ration is 2:1 and long term finance is 1,00,000, equity will be 66666.67. Hence 66,666.67 is tangible net worth
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