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answer needed ASAP Question 2 [33 marks 50 MINUTES You have secured a holiday job as a financial journalist with a media house and one
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Question 2 [33 marks 50 MINUTES You have secured a holiday job as a financial journalist with a media house and one of your tasks is to analyse the financial statements of newly listed companies. The Hubbard Limited is a company that bases and distributes a range of cakes and muffins to food outlets. There is no finished good inventory as all baked items are either sold or donated to the homeless. You have examined the financial statements of the company and drafted the following to aid your analysis on MS Excel computer package. Table 2U: Summarised statements of profit or loss for the year ended 30 September 2021 2020 Sales R2,000,000 R1,800,000 Cost of sales (1.100.000) (1.080.000) Gross profit 900,000 720,000 Operating expenses (617.500) (491.500) Profit before taxation and interest 282,500 228,500 Finance costs (12,500) (12.500) Profit before taxation 270.000 216,000 Taxation (54.000) (43.200) Profit for the period 216.000 172.800 Table 2V: Extracts from the statement of financial position at 30 September 2021 2020 R R Non-current assets: Plant and equipment 700,000 800.000 Current assets: 547,000 301,500 Baking supplies 136,100 133.500 Accounts receivable 177,500 100,000 Bank balances 233,400 68,000 Total assets 1.247.000 1.101.500 Equity 870,000 744.000 Non-current liabilities 250,000 250.000 Trade payables and accruals 127.000 1.247.000 107.000 1.101.000 Table 2W: Dividends and share information for the year ended 30 September 2021 2020 Dividend paid R90,000 R80,000 Number of ordinary shares in issue 1,200,000 1,200,000 Market price per share at the end of the year 2.54 1.71 2021 (1) 0 (ii) Table 2X: Selected ratios of the Hubbard Limited for the year ended 30 September Gross profit percentage Earnings per share Price: earnings ratio Dividend yield Return on capital employed Current ratio Accounts receivable collection period: in days Accounts payable payment period: in days Gearing percentage Interest cover-times 2020 ? ? ? ? ? ? ? ? ? ? (iv) (v) (vi) (vii) (viii) (ix) You are required to: a) Complete the Table 2x with missing values. Workings must be shown. [23 marks] b) Briefly comment on the ratios in your completed Table 2X. [10 marks]Step by Step Solution
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