a bit of advice - gearing ratio

fez

I have been asked a question regarding the gearing ratio, and am slightly unsure of the answer.

Within the capital employed part of the equation, does one include the value for a 'merger reserve' that is shown within the Capital and Reserves figures reported on the balance sheet?

Apologies if this question has been answered before.
(It's quite urgent!)

jamesm96

fez wrote: »

I have been asked a question regarding the gearing ratio, and am slightly unsure of the answer.

Within the capital employed part of the equation, does one include the value for a 'merger reserve' that is shown within the Capital and Reserves figures reported on the balance sheet?

Apologies if this question has been answered before.
(It's quite urgent!)

I don't see why'd you'd exclude it, it's in equity on the balance sheet! Presumably you want the figure to look as healthy as you can, so unless the form you're completing / person you're responding to specifically said 'only include retained earnings and share capital' (or words to that effect) I'd include it.