6. Business A and Business B are both engaged in retailing, but seem to take a different approach to this trade according to the information available. This information consists of a table of ratios, shown below: Ratio Business A Business B Current ratio 2:1 1.5:1 0.7:1 Quick assets (acid test) ratio Return on capital employed (ROCE) Return on shareholders' funds (ROSF) 1.7:1 20% 17% 30% 18% 63 days 21 days 50 days 45 days Debtors turnover Creditors turnover Gross profit percentage Net profit percentage 40% 15% 10% 10% Stock turnOver 52 days 25 days

6. Business A and Business B are both engaged in retailing, but seem to take a different approach to this trade according to the information available. This information consists of a table of ratios, shown below: Ratio Business A Business B Current ratio 2:1 1.5:1 0.7:1 Quick assets (acid test) ratio Return on capital employed (ROCE) Return on shareholders' funds (ROSF) 1.7:1 20% 17% 30% 18% 63 days 21 days 50 days 45 days Debtors turnover Creditors turnover Gross profit percentage Net profit percentage 40% 15% 10% 10% Stock turnOver 52 days 25 days

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please solve the following, vertical analysis (refer to the formula)
3
Analyze and interpret the financial statement presented in terms of profitability ratios. A. Gross profit, operating and net income ratios See the second image as guide.
Answer Using the Pictures 4) Evaluate the information from (i) two liquidity ratios (ii) four debt management ratios (iii) four profitability ratios
Assume the following data for Cable Corporation and Multi-Media Incorporated. Net income Sales Total assets Total debt Stockholders' equity Cable Corporation $ 34,400 364,000 448,000 237,000 211,000 Cable Corporation Multi-Media, Incorporated a. 1. Compute return on stockholders' equity for both firms. Note: Input your answers as a percent rounded to 2 decimal places. Return on Stockholders' Equity Multi-Media Incorporated $ 128,000 2,700,000 % % 970,000 468,000 502,000
7. Problem 3-08 (Profit Margin and Debt Ratio) Profit Margin and Debt Ratio eBook Profit margin: Assume you are given the following relationships for the Haslam Corporation: Sales/total assets Return on assets (ROA) Return on equity (ROE) Calculate Haslam's profit margin and liabilities-to-assets ratio. Do not round intermediate calculations. Round your answers to two decimal places. Liabilities-to-assets ratio: % % 3 Problem Walk-Through % 1.1 4% 6% Suppose half of its liabilities are in the form of debt. Calculate the debt-to-assets ratio. Do not round intermediate calculations. Round your answer to two decimal places.
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VII. Direction: Compute and interpret. The following comparative financial statements are provided by Avatar Industries. You were asked to compute the different financial ratios and provide your interpretations with regards to profitability, efficiency, liquidity and solvency of the company. Use the Answer Sheet template below to input your answer and solution. AVATAR INDUSTRIES AVATAR INDUSTRIES Comparative Statement of Financial Position For the years 2019 and 2018 Comparative Income Statement For the years 2019 and 2018 2019 2018 2019 2018 ASSETS Current Assets: Sales P200,000 P210,000 Cash & Cash Equivalent P65,000 P70,000 Sales Returns and Allowances 40,000 25,000 Accounts Receivable 40,000 35,000 Net Sales 160,000 185,000 Marketable Secuities 40,000 35,000 Cost of Goods Sold 100,000 115,625 Inventory 100,000 80,000 Gross Profit 60,000 69,375 Total Current Assets 220,000 200,000 160,000 P445,000 P380,000 245,000 Operating Expenses: Fixed Assets Selling Expenses 22,000 25,000 Total…
a) Consider the financial ratios of ABK Bank and the average ratios of peer banks based on 2015 year-end data shown in the table below: Ratios ABK Bank Peer Banks Return on equity (ROE) 14.50% 7.40% Return on assets (ROA) Asset utilisation (AU) Expense ratio (ER) 1.68% 0.85% 6.65% 5.50% 4.95% 4.62% TAX 0.02% 0.03% Note that TAX = applicable income tax/total assets Compare and critically discuss the performance of ABK Bank and that of its peer banks. Conduct a return on equity decomposition analysis for ABK bank and the peer banks as part of your discussion. What are the possible limitations in your analysis?
a. Return on equityb. Total assets turnoverc. Return on assetsd. Current ratioe. Receivables turnover
MANCOSA POSTGRADUATE DIPLOMA IN PRORCT MANAGEMENT QUESTION REQUIRED Use the information provided below to calculate the following ratios. Where applicable, und e answers to two decimal places 111 Gross profe margin 312 Operating profit margin 31.3 invertory turnover period 31.4 Trade recelvatles peried 31.5 Trade payables period 31 316 Current ratio 3.1.7 Acid test ratio 3.18 Return on capital employed 32 Comment on the control ef debtors by Saturn imited Sugpest TWO 2) ways in which Saturn Limited can improve its operating profit margin. 33 INFORMATION Excerpts of financial data of Satum Limited for 2019 are as follows: STATEMENT OF COMPREHINSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2019 2600 00 Cost of sales Gros proft Operating profit 1400 000 600 000 40 000 S60 00 Interest expense Proft before tas Tan N STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER: 2019 2008 ASSETS Non-current assets Inventories Accounts recelvable 780000 500 000 240 000 120 000 45L000 1250 p0 EQUITY AND…