Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Refer to the below information and answer the questions that follow. STAR Ltd and JELLY Ltd companies are agribusiness firms and operate in the livestock
Refer to the below information and answer the questions that follow. STAR Ltd and JELLY Ltd companies are agribusiness firms and operate in the livestock sector. The two companies have each a division that operate in Siavonga and focus on producing and selling Fillet and Bream with in the various parts of Zambia through Shoprite chain stores The following are summaries of financial statement data for both companies for the year ended March 31, 2020. STAR Ltd Statement of Financial Position as at March 31 2020 Cash K360,000 A/Payable --------- K400,000 A/Receivable 840,000 N/Payable 600,000 Inventory------------- 800,000 Accruals 200,000 Total current assets 2,000,000 Total Current Liabilities-- 1200,000 Noncurrent Assets- 3.200,000 Bonds payable ------------ 600,000 Common stock ( K100 par) 2,400,000 Retained Earnings-------- 1000,000 Total Assets--------- K5,200,000 Total Liability and Equity K5,200,000 JELLY Ltd Statement of Financial Position as at March 31 2020 Cash-------- K366,000 A/Payable A/Receivable ------ 954,000 N/Payable Inventory------------- 890,000 Accruals Total current Assets 2,210,000 Total Cument Liabilities- Noncurrent Assets 3,510,000 Bonds payable ------------ Common stock (K 100 par) Retained Earnings-------- Total Assets---------- K5,720,000 Total Liability and Equity K300,000 350,000 250,000 900,000 500,000 2,300,000 2,020,000 K5.720,000 Income Statement for the period ending March 31, 2020 STAR Ltd Sales $4,500,000 Operating costs 3,200,000 Earnings before interest & tax- 1,300,000 Interest expense 60.000 Earnings before tax 1,240,000 Tax (35%) 434,000 Net income 806,000 Dividend 270,000 Additions to Retained Earnings- 536,000 JELLY Ltd 5,000,000 3,800,000 1,200,000 75,000 1,125,000 393,750 731,250 240,000 491,250 Required (20 Marks) A. Conduct a comprehensive business performance analysis using all possible financial ratios. B. Write a brief commentary report that highlights areas of strength and weakness for each company relative to one another
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started