year 2019 & 2020.
Case Study Mohammed & Co. is a Corporation with a focus on Food and Beverage manufacturing in the UAE. They are now looking to finance their new project, a restaurant chain. To raise funds they will issue shares to the publis.You are required to calculate and analyze the following ratios: a) Total Asset turnover b) Fixed Asset tumover c) Price to Earnings Ratio d) Market to Book Ratio e) Net Profit Margin f) Gross Profit Margin g) Dividends per share h) Operating Return on Assets [8 points] Mohammed & Co. currently has 60,000 shares outstanding with the dividend announced for the current year (2020) at AED 49,000 and last year (2019) the dividend announced was at AED 52,000 for the entire group. The opening share price of Mohammed & Co. on 30% of March 2020 was AED156.7 and AED104.8 on 30 March 2019. Based on the ratios calculated above. Can you conclude if Mohammed & Co. is a good investment opportunity for the prospective Shareholder? [2 points) Case Study Statement of profit or loss and other comprehensive income Year ended 31 March 2020 31 March 2020 31 March 2019 Notes AED AED Sales 6 35,672,910 40,574,176 Cost of sales 7 (29,275,796 32.228,315) Gross profit 6,397,114 8,285,861 Other income 8 28,429 78,911 Selling and administrative expenses (5,197,646) (5,435,680) Impairment loss on trade receivables (63,956) (253,933) Finance costs 11 1996,380) (980,367) Profit for the year 167,561 1,694,792 Other comprehensive income Total comprehensive Income for the year 167.561 1,694,792 9 10 I Case Study Statement of financial position As at 31 March 2020 31 March 2020 AED 31 March 2019 AED Notes 13 24 16 Non-current assets Property and equipment Dues from related parties Margin deposits with banks Current Assets Inventories Trade and other receivables Margin deposits with banks Cash and cash equivalents 590,636 115,556 33,000 739,192 707,701 115,556 33,000 856,257 14 15 16 17 21,429,037 20,154.523 588.922 1,539 42,174,021 42,913,213 22,687,689 17,336,497 2,897,975 3,873 42.926,034 43.782,291 Total assets Shareholders' fonds Share capital Statutory reserve Retained earnings Equity funds Shareholders' loan Shareholders' current accounts 18 (8) 18 (b) 600,000 300,000 3,544,788 4,444,788 14,578,348 (1.013,049) 18,010,087 600,000 300,000 3,377.227 4,277,227 16,417,584 (716,269) 19,978,542 19 20 Nes-current liabilities Borrowings Provision for staff end-of-service gratuity 21 22 97,222 771,221 868,443 73,831 745,132 818,963 Current liabile Borrowing Trade and other payables 21 23 9,754,075 14,280,503 24,034, 683 24.903, 126 (2,913,213 Total ilayaga Total Shirolders' funds and abilities 10,433,291 12,551,495 22.984,786 23,303,749 43722291
