Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The a2 Milk Company Limited (a2MC) is engaged in the commercialization of a2MC branded milk and related products. The Company's portfolio composition includes liquid milk,
The a2 Milk Company Limited (a2MC) is engaged in the commercialization of a2MC branded milk and related products. The Company's portfolio composition includes liquid milk, infant formula and other. The Company's brands include a2 Milk and a2 Platinum. The following are the reformatted consolidated financial statements of a2 Milk Company Limited as at 30 June 2019. Reformatted income statement for the year ended 30 June 2019 $'000 Sales 1,304,336 Cost of sales (590,584) Gross Profit 713,752 Other revenue 160 Distribution expenses (31,290) Administrative expenses (71,161) Marketing expenses (135,301) Other expenses (64,608) Profit before interest and tax 411,552 Net finance income 4,159 Profit before tax 415,711 Income tax expense (127,970) Profit after tax 287,741 Reformatted balance sheet as at 30 June 2019 $' 000 Assets Current assets Cash and short-term deposits 464,805 Trade and other receivables 52,748 Prepayments 49,693 Inventories 108,453 Total current assets 675,699 Non-current assets Property, plant and equipment 10,296 Intangible assets 12,985 Other assets 294,490 Total non-current assets 317,771 Total assets 993,470 Liabilities Current liabilities Trade and other payables 160,248 Other liabilities 45,141 Total current liabilities 205,389 Non-current liabilities Trade and other payables 227 Total non-current liabilities 227 Total liabilities 205,616 Net assets 787,854 Equity Share capital 144,495 Retained earnings 578,442 Reserves 64,917 Total equity 787,854 Required: Use the information above, calculate the following ratios for 2019. (Round your answers up to the nearest whole number for the days inventory and days debtors, and round the rest of your answers to two decimal places.) (i) Gross profit margin (ii) Profit margin (iii) Return on assets (iv) Days inventory (days) (v) Days debtors (days) (vi) Current ratio Enter your answer in the 2019 column and show workings. Workings 2019 Gross profit margin Profit margin Return on assets Days inventory (days) Days debtors (days) Current ratio
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