Question
Question 3 XYZ Companys financial statements contain the following information. Appraise the financial position of the company from the point of view of: Liquidity (Current
Question 3
XYZ Companys financial statements contain the following information. Appraise the financial position of the company from the point of view of:
- Liquidity (Current and Acid ratios),
- Profitability (Gross Profit, Net Profit, Return on Total Asset, Return on Capital employed, Return on Equity Funds ratios), and
- Activity (Debtors Turnover, Stock Turnover and Total Assets Turnover ratios).
|
| 2007 | 2008 |
|
| Rs. | Rs. |
| Cash | 200,000 | 160,000 |
| Sundry debtors | 320,000 | 400,000 |
| Temporary Investments | 200,000 | 320,000 |
| Stock | 1,840,000 | 2,160,000 |
| Prepaid Expenses | 28,000 | 12,000 |
| Total Current Assets | 2,588,000 | 3,052,000 |
| Total Assets | 5,600,000 | 6,400,000 |
| Current Liabilities | 640,000 | 800,000 |
| Loans | 1,600,000 | 1,600,000 |
| Capital | 2,000,000 | 2,000,000 |
| Retained Earning | 468,000 | 812,000 |
Statement of Profit & Loss of the Current Year
|
| Rs. |
| Sales | 4,000,000 |
| Less cost of goods sold | (2,800,000) |
| Less interest | (160,000) |
| Net Profit | 1,040,000 |
| Less taxes @ 50% | 520,000 |
| Profit after tax | 520,000 |
| Profit distributed | 220,000 |
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Principles Of Public Finance
Authors: Toshihiro Ihori
1st Edition
9811023883, 978-9811023880
