Using the Company’s above Statement of financial position and Statement of profit or loss, answer the following questions:
(a) Calculate the net working capital for the year 2021 and comment on the result in the
context of the company’s financial position.
(b) Calculate cash flow from assets (CFFA) for the year 2021 and comment on the result in the
context of the company’s financial position.
(c) Write a brief analytical report on the financial position of the company based on the above
analysis (approximate 600 words)
Question:
Using the Australasia Apex Company’s Balance sheet and Income statement above, discuss the company’s:
(a) short-term solvency or liquidity position
(b) long-term solvency or financial leverage ratios
(c) profitability ratios, and
(d) Market value ratios using at least 3 ratios in each category.
In your discussion, you must calculate the relevant ratios and then interpret the result in the
context of the company’s financial performance. The company has 33 million shares
outstanding and per share price is $88.
(e) Write a brief report on the company’s performance based on the above analysis

Australasia Apex Company
Statement of financial position (Balance Sheet)
as of 30 June 2020 and 2021 ($ in millions)
Assets 2021 2020 Liabilities and shareholders’ equity 2021 2020
Current assets Current liabilities
Cash $146 $84 Accounts payable $344 $312
Accounts receivable 188 165 Notes payable 196 231
Inventory 422 393 Total $540 $543
Total $756 $642
Non-current assets
Property, plant and
equipment $2889 $2731 Non-current debt $457 $531
Shareholders’ equity
Ordinary shares $550 $500
Retained earnings 2089 1799
Total $2639 $2299
Total assets $3636 $3373 Total liabilities and shareholders’
equity $3636 $3373

Statement of profit or loss for Australasia Apex Company for the year 2021($ in millions)
Sales Revenue $2311
Cost of goods sales 1344
Depreciation 276
Earnings before interest and taxes (EBIT) $691
Interest paid 141
Profit before tax $550
Taxes 115
Profit for the period (Net Income) $435
Dividends $145
Addition to retained earnings 290