# Workbook Question 5.2 (Osbourne Books)

Registered Posts: 26
Hi all, could someone please explain how to work out the Gearing Ratio % for the question above. Thanks in advance.

• Registered Posts: 237 Dedicated contributor 🌟 🐵 🌟
Gearing ratio is..

Debt x 100 / Debt + Equity.

Cannot see any question above though?
• Registered Posts: 26
Hi Emma, I was referring to the question in the title in the hope someone currently studying the module was using the same resource. Maybe I can post the question later

I'm sure my book describes the formula as:

(Debt / Debt + Equity) x 100

Perhaps its a typo by Osborne.
• Registered Posts: 25
I have always used the (Debt / Debt + Equity) x 100 formula
• MAAT Posts: 474 Dedicated contributor 🌟 🐵 🌟
edited February 2020
The 2 formulae are functionally the same the x 100 can go on the top of the fraction or after the whole thing.

You could even do:

(100/(Debt+Equity)) x Debt or (1/(Debt+Equity)) x Debt x 100

Unfortunatly I don't have my osborne books on hand at work anymore so can't see the question.

I will add that written convention would have it as

(Debt/(Debt+Equity)) x 100

This is simply because the x 100 just converts the decimal ratio to a percentage
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• Registered Posts: 237 Dedicated contributor 🌟 🐵 🌟

Hi Emma, I was referring to the question in the title in the hope someone currently studying the module was using the same resource. Maybe I can post the question later

I'm sure my book describes the formula as:

(Debt / Debt + Equity) x 100

Perhaps its a typo by Osborne.

Hi John,

Sorry but I don't have the text book so unsure of the exact question. I believe both formulas work but I always used debt x 100 / debt + equity.

Thank you
• Registered Posts: 4
those are the figures @Emmalouise18
• Registered Posts: 4
those are the figures @Emmalouise18
• Registered Posts: 4
those are the figures @Emmalouise18
• Registered Posts: 4
the file wont upload i dont know why @Emmalouise18
• Registered Posts: 1
> @John_Clyne said:
> Hi all, could someone please explain how to work out the Gearing Ratio % for the question above. Thanks in advance.

Hey did you ever find out the answer to this? I'm stuck on the exact same question and I can't understand how they've worked it out?
• Registered Posts: 6 New contributor 🐸
Did anyone ever get the answer to this? Stuck on the same thing!