The following figures are for AB Engineering Supplies Ltd at 31 December 20X9:

(a) Calculate:

(i) Gross profit as a percentage of the sales;

(ii) Rate of stock turnover;

(iii) Net profit as a percentage of sales;

(iv) Net profit as a percentage of total capital employed (fixed assets plus current assets);

(v) Current ratio;

(vi) Quick asset (acid test) ratio.

(b) The following figures are for another firm in the same line of business, CD Engineering Services Ltd, for the year ended 31 December 20X9.

Compare your results in (a) with those given for CD Engineering Services Ltd. As a result of your comparison, say which you think was the more successful business during 20X9, giving your reasons.

Transcribed Image Text:

Turnover Gross profit Average stock at cost price Expenses Fixed assets Current assets Stock Debtors Bank Current liabilities Capital £000 10 IN ∞ 8 2 £000 160 40 10 8 108 20 128 (10) 118 118