Belt plc and Braces plc were in the same industry. The following information appeared in their 20X9 accounts:

(a) Calculate the following ratios for each company and show the numerical relationship between them:
(i) Their rate of return on the average total assets.
(ii) The net profit percentages.
(iii) The ratio of revenue to average total assets.
(b) Comment on the relative performance of the two companies.
(c) State any additional information you would require as:
(i) A potential shareholder.
(ii) A potential loancreditor.

Transcribed Image Text:

Belt Braces Revenue Total operating expenses Average total assets during 20X9 200 180 150 300 275 125