The capital of a limited liability company is made up as follows:
$m
Issued ordinary share capital 1,000
Share premium account 1,500
Accumulated profits 3,000
8% loan notes 1,500
Which of the following calculations of the company’s gearing ratio, based on these figures, is correct?
A 1,500/6,000 = 1 25%
B 4,500/1,500 = 300%
C 4,500/6,000 = 1 75%
D 1,500/1,000 = 150%

A