Use the information above to calculate and evaluate the following ratios for both the companies and which you prefer.Where applicable, round off answers correctly to two decimal places.
Use the information above to calculate and evaluate the rations for both the companies and which you prefer.
Where applicable, round off answers correctly to two decimal places.
use the information above to calculate and evaluate the following ratios:
- Current ratio
- Liquidity ratio
-Debtors collection period
-Creditors payment period (Use the cost of -sales Figure)
-Stock Turnover
-Return on equity
-Asset Turnover(Total Assets)
*Which company would you prefer to invest in and why?
10.2.3 FINANCIAL ADMINISTRATION 102 Question 1
[100]
[25]
The financial statements of XB limited and ST Limited for the year ended 31 January 2022 are presented below Both companies are wholesale of cleaning products Statement of Comprehensive Income XB Limited ST Limited Sales 27 000 000 16000000 Cost of Sales 20000000 10000000 Gross profit 7000000 6 000 000 Operating expenses 1000000 1000000 Operating profit 6000000 5000000 Interest expense 600000 400 000 Profit before Tax 5400000 4 600000 Dividend 1000000 700000 Profit after Tax 4400000 3 900 000
Statement of Financial Position Fixed Assets Buildings 300 000 Equipment 100 000 400 000 Current Assets
150 000 100000 250000
Inventory
3000000
2 400 000
BACHELOR OF BUSINESS ADMINISTRATION YEAR 1-ACADEMIC AND ASSESSMENT
Debtors Bank
3000000
2000000 1500000 5900000
2000000 8000000
Total Assets
8400 000
6 150 000
Equity and Liabilities Share Capital 200 000 Retained Earnings 5 800 000
100000
4000000 4 100000
6000000
Current Liabilities Creditors
2400000 2400000
2050 000 2050 000
Total Equity and Liabilities
8400000
6 150 000
Required: Used the information above to calculate and evaluate the following ratios for both the companies and which you prefer. Where applicable,round off answers correctly to two decimal places
