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Help please, I have wrong answers (Liquidity and profitability analysis) Superior Kitchens and Bathrooms Ltd. is a small business that sells kitchen and bathroom fixtures
Help please, I have wrong answers
(Liquidity and profitability analysis) Superior Kitchens and Bathrooms Ltd. is a small business that sells kitchen and bathroom fixtures and accessories and also does design and installation. The business was started three year's ago by Qing Liu. Initially the company's operations consisted of kitche and bathroom renovations for individual homes. In 2019, the company started providing design and installation services to local contractors to expand sales. As the contractor side of the business grew in 2020, the company purchased a truck for deliveries. All sales to individuals are cash on delivery, but for contracting jobs, customers are invoiced and are offered 30-day payment terms. The company's suppliers offer terms of 30 days. Selected financial information for Superior Kitchens and Bathrooms Ltd. follows. Assume the growth in sales in 2020 is primarily from the contracting business. Calculate the gross margins and the profit margins. (Round answers to 1 decimal place, e.g. 15.1\%.) Calculate the company's current ratio and quick ratio for both years. (Round answers to 2 decimal places, e.g. 1.84.) Calculate the company's accounts receivable turnover ratio for 2020 . How quickly is the company collecting its receivables? (Round answers to 1 decimal place, e.g. 18.4.) Assume that 50% of the sales come from the contracting business and recalculate the accounts receivable turnover for 2020. (Round answers to 1 decimal place, e.g. 18.4.)Step by Step Solution
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