The following two companies Alpha Industries and Beta Industries operate in the same industrial sector. You have

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The following two companies Alpha Industries and Beta Industries operate in the same industrial sector. You have extracted the following ratios from their accounts.

Alpha Return on capital employed 9%

Gross profit ratio 25%

Net profit ratio 7%

Current ratio al Quick ratio Ps7, Price/Earnings ratio 4 Dividend cover 2 Required:

Compare the financial performance of the two companies. All other things being equal, which company would you expect to have the higher market price?

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Accounting For Non Specialists

ISBN: 9780471495727

1st Edition

Authors: Michael Jones

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Question Posted: Jul 15, 2024 01:07 AM

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The following two companies Alpha Industries and Beta Industries operate in the same industrial sector. You have

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Accounting For Non Specialists

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