An analyst is calculating the Total Adjusted Debt for an infrastructure company. The balance sheet and notes disclose: Long-term Secured Borrowings: Rs. 500 crore; Unsecured Term Loans: Rs. 250 crore; Current Maturities of Long-Term Debt: Rs. 100 crore; Short-Term Bank Borrowings: Rs. 150 crore; Finance Lease Obligations: Rs. 80 crore; Accrued Interest Payable: Rs. 20 crore; Trade Accounts Payable: Rs. 200 crore. What is the Total Adjusted Debt of the company?

[ A ]Rs. 1,300 crore

[ B ]Rs. 1,100 crore[ CORRECT ]

[ C ]Rs. 750 crore

[ D ]Rs. 900 crore

Takeaway

Option B is correct: Rs. 1,100 crore

Derivation

Total Adjusted Debt includes all interest-bearing financial liabilities, lease obligations, and accrued financing costs across both current and non-current balance sheet sections, strictly excluding operational trade credit (trade payables). Total Adjusted Debt = Secured Borrowings (500) + Unsecured Loans (250) + Current Maturities (100) + Short-term Borrowings (150) + Finance Lease Obligations (80) + Accrued Interest (20) = Rs. 1,100 crore. Trade payables (Rs. 200 cr) are operational liabilities, not financial debt. This tests debt aggregation mechanics. The common error is omitting current maturities or including trade payables.

Why the others fail

A — Rs. 1,300 crore

Rs. 1,300 crore erroneously includes operational trade payables of Rs. 200 crore as financial interest-bearing debt.

C — Rs. 750 crore

Rs. 750 crore accounts only for long-term borrowings, ignoring short-term debt, current maturities, and lease liabilities.

D — Rs. 900 crore

Rs. 900 crore omits current maturities of long-term debt (100 cr) and finance lease obligations (80 cr) from total debt.