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Subjects · Leaving Cert Accounting

Leaving Cert Accounting: Ratios — gearing

How often Ratios — gearing comes up on the Accounting papers, every year it was asked, and questions to try.

HL Asked on 8 of the last 10 Higher Level papers, most recently in 2026. most years

Ratios — gearing, Higher Level(6 marks)

Quick ones on Ratios — gearing.

(a)Fixed-interest capital above 50% of capital employed means the firm is…
  1. Low geared
  2. Highly geared
  3. Illiquid
(b)A highly geared company carries greater…
  1. Share premium
  2. Liquidity
  3. Financial risk
(c)Interest cover is…
  1. Profit before interest ÷ interest
  2. Net profit ÷ total loans
  3. Interest ÷ profit before interest
Show the answers

(a) Highly geared

(b) Financial risk

(c) Profit before interest ÷ interest

Your turn: Higher Level questions on Ratios — gearing.

Higher Level

Asked on 8 of the last 10 Higher Level papers, most recently in 2026. most years

Every paper, year by year

YearWhere it came up
2026Q5
2025Q5
2024Q5
2023Not asked
2022Q5
2021Q5
2019Not asked
2018Q5
2017Q5
2016Q5

Links open the State Examinations Commission’s paper for that year.

More Ratios — gearing questions

Ratios — gearing, 2 marks

Profit before interest €80,000; interest €10,000. Interest cover?

  1. 7 times
  2. 10 times
  3. 8 times
Show the answer

8 times

€80,000 ÷ €10,000 = 8 times: profit could fall a long way before interest could not be paid.

Other Accounting topics

All of Leaving Cert Accounting