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Question 2 From the following annual accounts of ABC Ltd, you are required to calculate the following ratios and comment on the results, indicating what
Question 2
From the following annual accounts of ABC Ltd, you are required to calculate the following ratios and comment on the results, indicating what other information you may require:
- Gross profit percentage,
- Net profit percentage,
- Return on total assets,
- Quick asset ratio,
- Debtors collection period,
- Stock turnover,
- Fixed assets turnover,
- Return on shareholders funds,
- Current ratio, and
- Debt ratio.
Balance Sheet as at 31 December 2020
| Rs. |
Share Capital | 450 |
Retained Profit | 240 |
| 690 |
12% Debentures | 700 |
Trade Creditors | 620 |
Proposed Dividend | 45 |
| 2,055 |
Fixed Assets net of depreciation | 875 |
Stocks | 310 |
Debtors | 100 |
Bank Balance | 100 |
Extract from Profit & Loss Account | 2,055 |
| Rs. |
Sales for the year | 3,100,000 |
Gross Profit | 1,725,000 |
Expenses | 805,000 |
Depreciation | 250,000 |
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