You are to study the following financial statements for two furniture stores and then answer the questions which follow: Home Furnitures Comfort Furnitures RM RM RM RM Statement of Profit or Loss Sales 700,000 950,000 Less: Cost of goods sold: Opening inventories 150,000 100,000 Purchases 300,000 420,000 450,000 520,000 Less: Closing inventories (115,000) (335,000) (95,000) (425,000) Gross profit 365,000 525,000 Less: Expenses: Depreciation 5,000 20,000 Wages & salaries 190,000 300,000 Other expenses 65,000 (260,000) 50,000 (370,000) Net profit 105,000 155,000 Statement of Financial Position Non-current assets Equipment 50,000 20,000 Current assets Inventories 115,000 95,000 Trade receivables 135,000 150,000 Bank 25,000 275,000 12,500 257,500 325,000 277,500 Equity: Opening capital 85,000 80,000 Add: Net profit 105,000 155,000 190,000 235,000 Less: Drawings (39,000) 151,000 (58,500) 176,500 Current liabilities Trade payables 174,000 101,000 325,000 277,500 Required: (a) Calculate the following ratios for each business: (iv) Quick ratio; (v) Inventories turnover times; (vi) Trade receivables turnover days;
Question 2
You are to study the following financial statements for two furniture stores and
then answer the questions which follow:
Home Furnitures Comfort Furnitures
RM RM RM RM
Statement of Profit or Loss
Sales 700,000 950,000
Less: Cost of goods sold:
Opening inventories 150,000 100,000
Purchases 300,000 420,000
450,000 520,000
Less: Closing inventories (115,000) (335,000) (95,000) (425,000)
Gross profit 365,000 525,000
Less: Expenses:
Depreciation 5,000 20,000
Wages & salaries 190,000 300,000
Other expenses 65,000 (260,000) 50,000 (370,000)
Net profit 105,000 155,000
Statement of Financial Position
Non-current assets
Equipment 50,000 20,000
Current assets
Inventories 115,000 95,000
Trade receivables 135,000 150,000
Bank 25,000 275,000 12,500 257,500
325,000 277,500
Equity:
Opening capital 85,000 80,000
Add: Net profit 105,000 155,000
190,000 235,000
Less: Drawings (39,000) 151,000 (58,500) 176,500
Current liabilities
Trade payables 174,000 101,000
325,000 277,500
Required:
(a) Calculate the following ratios for each business:
(iv) Quick ratio;
(v) Inventories turnover times;
(vi) Trade receivables turnover days;
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