Aradya Ltd. maintains a Debt-Equity ratio of $2.5:1$. Which of the following transactions will not affect its Debt-Equity Ratio?

The formula for the Debt-Equity Ratio is:
$$\text{Debt-Equity Ratio}=\frac{\text{Long-term Debt}}{\text{Shareholders’ Equity}}$$
Let's analyze the impact of each option:Option A: Changes long-term debt (increases bank loan). Thus, the ratio changes.Option B: Payment made to creditors reduces a current liability (Creditors) and a current asset (Cash). Since neither long-term debt nor shareholders' equity changes, the Debt-Equity ratio remains unaffected.Option C: Reduces long-term debt (debentures) and increases shareholders' equity (equity shares). Thus, the ratio changes.Option D: A profit of $\text{Rs. }50,000$ on the sale of furniture increases the balance of Reserves and Surplus (Shareholders' Equity), which changes the ratio.