Bianqa Ltd, a medium-sized company operating in the agrifood sector supplies quality prepared food products in the Irish and UK markets.

The average performance of companies in the same industry as Bianqa Ltd for 20x0 is detailed in the table as follows:

Requie:

a. Calculate the following for 20x0 for Bianqa Ltd:
1. Return on investment (ROI)
2. Current ratio 3. Acid test ratio 4. Debt/equity ratio

b. Analyse the profitability and liquidity of Bianqa Ltd for 20x0, with reference to the industry average results shown in the box above, and make recommendations for Bianqa Ltd.

Transcribed Image Text:

Industry average results 20x0 Return on investment (ROI) Current ratio Acid test ratio Debt/equity ratio 11% 2 1.2 0.3 The following figures are taken from the final accounts c Bianqa Ltd for 20x0. Bianqa Ltd figures for 20x0 Net profit 50,000 Sales 975,000 Current assets (including closing stock) 155,000 Long-term loan 300,000 Ordinary share capital 500,000 Current liabilities 85,000 Retained earnings Closing inventory 100,000 80,000