While calculating proprietary ratio, should we deduct PRELIMINARY EXPENSES from shareholder's fund i e, (share capital+reserves and surplus) - Accountancy - Accounting Ratios

Question

While calculating proprietary ratio, should we deduct
PRELIMINARY EXPENSES from shareholder's fund i e, (share
capital+reserves and surplus) ??

Manisha Arora · Accepted Answer

Yes Namitha, while calculating Proprietary Ratio, Preliminary
Expenses must be deducted from Shareholder's Fund as these are
Fictitious Assets of the company

While calculating proprietary ratio, should we deduct PRELIMINARY EXPENSES from shareholder's fund i.e, (share capital+reserves and surplus) ??