Question
The business has been operating for two years now. Below are financial reports for JJ Asian Cuisine. Please calculate and comment on the following ratios
The business has been operating for two years now. Below are financial reports for JJ Asian Cuisine.
Please calculate and comment on the following ratios for JJ Asian Cuisine 2021
| Industry benchmark | |
| Return on equity | 20% |
| Return on assets | 13% |
| Profit margin | 5% |
| Asset turnover | 2.5 |
| Current ratio | 2.5 |
| Debt ratio | 75% |
| J & J Asian Cuisine Income Statement For period ending June 30 2021 | ||
| 30-Jun | 30-Jun | |
| 2020 | 2021 | |
| Cash Sales | 100,800.00 | 272,160.00 |
| Credit Sales | 43,200.00 | 116,640.00 |
| Total Revenue | 144,000.00 | 388,800.00 |
| Grocery expense | 39,400.00 | 106,380.00 |
| Petrol expense | 2,400.00 | 6,480.00 |
| Wages expense | 65,500.00 | 172,100.00 |
| Packaging Supplies | 8,000.00 | 21,600.00 |
| Depreciation expense - Vacuum sealer | 133.33 | 133.33 |
| Depreciation expense -Bowl sealing machine | 600.00 | 600.00 |
| Depreciation expense - website | 400.00 | 400.00 |
| Depreciation - car | 2,000.00 | 2,000.00 |
| Rent expense | 15,840.00 | 15,840.00 |
| Electricity and Gas | 5,660.00 | 15,180.00 |
| Water | 440.00 | 1,120.00 |
| Business registration fee | 90.00 | - |
| Interest expense | 1,200.00 | - |
| Total expenses | 141,663.33 | 341,833.33 |
| Profit/Loss | 2,336.67 | 46,966.67 |
| J & J Asian Cuisine Balance Sheet Statement As at 30/06/21 | ||
| 30-Jun | 30-Jun | |
| 2020 | 2021 | |
| ASSETS | ||
| Current Assets | ||
| Cash | 4,583.44 | 53,222.32 |
| Accounts receivable | 864.00 | 15,396.48 |
| Packaging Supplies | 68.00 | 172.00 |
| Total current assets | 5,515.44 | 68,790.80 |
| Non-current assets | ||
| Bowl Sealing Machine | 3,000.00 | 3,000.00 |
| Less Accumulated depreciation - Bowl sealing machine | - 600.00 | - 1,200.00 |
| 2,400.00 | 1,800.00 | |
| Vacuum sealer | 800.00 | 800.00 |
| Less Accumulated depreciation - vacuum sealer | - 133.33 | - 266.67 |
| 666.67 | 533.33 | |
| Website | 1,200.00 | 1,200.00 |
| Less Accumulated depreciation - website | - 400.00 | - 800.00 |
| 800.00 | 400.00 | |
| Car | 15,000.00 | 15,000.00 |
| Less Accumulated depreciation - car | - 2,000.00 | - 4,000.00 |
| 13,000.00 | 11,000.00 | |
| Total non-current assets | 16,866.67 | 13,733.33 |
| TOTAL ASSETS | 22,382.11 | 82,524.13 |
| LIABILITIES | ||
| Current Liabilities | ||
| Accounts payable (Packaging Supplies) | 645.44 | 1,055.20 |
| Accounts payable (Grocery supplies) | 12,765.60 | |
| Total current liabilities | 645.44 | 13,820.80 |
| Non - current Liabilities | ||
| Loan | - | - |
| Total non-current liabilities | - | - |
| TOTAL LIABILITIES | 613.28 | 13,807.24 |
| Net Asset | 21,736.67 | 68,703.33 |
| OWNERS EQUITY | ||
| Capital | 21,736.67 | |
| Contributions | 20,000 | - |
| Profit made | 2,336.67 | 46,966.67 |
| Drawings | - 600.00 | - |
| Total owner equity | 21,736.67 | 68,703.33 |
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Connect For Financial Accounting Information For Decisions
Authors: Author
10th Edition
1260386937, 9781260386936
