Question:

The following attachments are the financial statements of two companies listed in Amman Stock Exchange (ASE) for the years of 2017 to 2019.

Requirements:

a.Compute the following ratios for both companies:

i. Working capital

ii. Current ratio

iii. Acid test ratio

iv. Cash flow from operations to current liabilities

v. Accounts receivable turnover ratio

vi. Days in receivables

vii. Inventory turnover ratio

viii. Average days in inventory

b.Based on the previous ratios discuss the working capital management and assess the relative working capital position for both companies.

Assets (10) Cash on Hand & at Banks Accounts Receivable Net Notes Receivable Post Dated Cheques Short Term Investments Inventory Spare Parts Total Current Assets Long Term Investments Fixed Assets Net Lands Projects in Progress Total Fixed Assets Other Assets Total Assets Liabilities (JD) 2019 2018 2017 7884294 71589063145990 4716437 4509091 4382576 0 0 0 0 0 D 0 0 7325780 5907534 6073001 0 0 0 20617881 18429985 14362067 0 0 0 3811020 4709722 5767461 234635 234635 234635 1380566 196732 248513 5426221 5141089 6250609 3204158 3196372 3307131 29248260 26767446 23919807 Accounts and Notes Payable Credit Banks Short Term Loans Accrued Part of Long Term Loans Total Current Liabilities Long Term Loans & Notes Payable Corporate Bonds Other Liabilities Total Liabilities Shareholders Equity ID) 2019 2018 2017 322986 35990 261288 0 0 0 0 0 0 0 0 0 992139 538297 399784 0 0 D 0 0 0 1804778 1937676 2440897 27969172475973 2840681 1974 Authorized Capital Subscribed Capital Paid in Capital Compulsory Reserves Voluntary Reserve Other Reserves Purchase of Non-controlling interest differences Issuance Premium Issuance Discount Treasury Stocks Cash Dividends Stock Dividends Accumulated Change in Fair Value Retained Earnings Total Shareholders Equity Non-controlling Interest Total Liabilities & Shareholders Equity Income Statement (ID) 2019 2018 2017 15000000 15000000 15000000 15000000 15000000 15000000 15000000 15000000 15000000 5980447 5721872 5393116 0 0 0 0 0 0 0 0 0 0 0 0 0 0 D D 0 0 10500000 0 0 0 0 0 0 D 44208963569601 686010 26451343 24291473 21079126 0 0 0 29248260 26767446 23919807 Operating Revenues Operating Expenses Gross Profit General and Administrative Expenses Selling and Distribution Expenses Depreciation (Period) Other Operating Expenses Net Operational Income Other Revenues Other perses 2019 2018 2017 8085809 9124141 1315123 45807905134763 4559382 3505019 39893783244259 17548191516796 1391147 0 0 1325197 13262391227009 D 0 0 1750200 24725824635406 940550 1149976 5764018 70000 300000 442869 16M 3322558685743 Other Revenues Other Expenses Income Before Interest & Tax Interest Expenses Net Income Before Tax Income Tax (period) Income Tax (Previous Years) Universities and Research Train Fees Board of Directors Remuniration Net Income Non-controlling Interest Net Income Pertains to Shareholders Cash Flow (JD) 940550 1149976 5764018 70000 300000 442869 2620750 3322558 685743 0 0 0 2620750 3322558 685743 425880 75211 4866 0 0 0 0 0 0 35000 35000 35000 2159870 3212347 645877 0 0 0 2159870 3212347 645877 Cash Balance (Beginning) Net Cash Flow from (Used in) Operating Activities Net Cash Flow from (Used in) Investing Activities Net Cash Flow from (Used in) Financing Activities Cash Balance (Ending) 2019 2018 2017 7158906 1145990 7342096 32430095169654 1081342 -2517621 843262 -1277448 0 0 -6000000 7884294 7158906 1145990