Grammar Ltd reports the following information. From this information, calculate and interpret the following ratios (year-end figures
Question:
Grammar Ltd reports the following information.
From this information, calculate and interpret the following ratios (year-end figures have to be used because the comparative year figures are not available) and prepare a report on the financial position and performance of Grammar Ltd.
(a) Liquidity ratio
(b) Return on equity
(c) Return on assets using:
(i) Profit
(ii) EBIT
(d) Debt ratio.
Transcribed Image Text:
Total assets Profit after tax Current liabilities Non-current liabilities $'000 3840 130 1 140 1660 Interest revenue Interest expense Tax expense Current assets = 50% of total assets $'000 220 320 90
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a Current assets 50 of total assets 50 x 3840 Current ratio measures the dollars of current assets an entity has per dollar of current liabilities Grammar Ltd has a current ratio of 168 times which me...View the full answer
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Related Book For
Accounting Business Reporting For Decision Making
ISBN: 9780730369325
7th Edition
Authors: Jacqueline Birt, Keryn Chalmers, Suzanne Maloney, Albie Brooks, Judy Oliver, David Bond
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