Question
Blendy Company provides the following balance sheet and income statement for the year of 2018. HARVEY COMPANY BALANCE SHEET AS OF 31 DECEMBER, 2018 ASSETS
Blendy Company provides the following balance sheet and income statement for the year of 2018.
HARVEY COMPANY
BALANCE SHEET
AS OF 31 DECEMBER, 2018
ASSETS $
Current Assets:
Cash in hand 100,000
Inventory 90,000
Debtors 145,000
Total current assets 3, 35,000
Non-Current Assets:
Total non-current assets 2,530,000
Total Assets 2,865,000
LIABILITIES
Current Liabilities:
Total Current liabilities 5,22,000
Non-Current Liabilities:
Long term loan 10,00,000
Total Liabilities 15,22,000
OWNERS EQUITY:
Paid up capital 740,000
Retained Earning 543,000
Share premium 60,000
Total 1,343,000
Total Liabilities & Equity 2,865,000
| Net Sales | $ 900,000 |
| Cost of goods sold | (550,000) |
| Gross profit | 350,000 |
| Operating Expenses | (90,000) |
| Earning after tax | 130,000 |
Required:
a. Calculate the following ratios:
(i) Account receivables turnover ratio in days
(ii) Inventory turnover ratio in days.
(iii) Fixed assets turnover.
(iv) Total assets turnover ratio.
(v) Return on Equity
Note: Assume 360 days in a year
b. Assuming that the industrial average for collection 150 days and fixed asset turnover is 40%,
Evaluate the performance of the BLENDY COMPANY based on your answer in part (a) above.
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African Charter For Internal Audit Of Cooperative Governance
Authors: Donfack MEKONTCHOU ROCHE
1st Edition
6205541777, 978-6205541777
