Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Peaks Ltd reported the following information in its financial statements: 2021 2020 $ $ Sales Revenue 700,200 650,000 Cost of Sales 422,000 474,500 Net Profit

Peaks Ltd reported the following information in its financial statements:

2021

2020

$

$

Sales Revenue

700,200

650,000

Cost of Sales

422,000

474,500

Net Profit

82,000

58,000

Total Current Assets

161,300

144,400

Total Non-current Assets

440,700

370,800

Total Current Liabilities

75,400

80,100

5 year 10% Debentures

110,600

125,900

Share Capital

340,000

300,000

General Reserve

10,000

10,000

Retained Earnings

175,000

95,000

The company does not have any inventory on hand in 2020 but has total prepaid expenses amounting to $51,400.

Required:

Using the above information calculate the following financial ratios to two decimal places. Provide a formula and show your workings for each ratio.

a) Gross profit margin for 2020 (1 mark)

b) Debt to assets for 2021 (1 mark)

c) Quick Ratio for 2020 (1 mark)

d) Return on Ordinary Shareholders Equity for 2021 (1 mark)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Research On Professional Responsibility And Ethics In Accounting Volume 24

Authors: Charles Richard Baker

1st Edition

180071758X, 9781800717589

More Books

Students also viewed these Accounting questions

Question

=+c) Which model fits better?

Answered: 1 week ago

Question

4 What is the recruitment phase?

Answered: 1 week ago