Help me only with question b)Financial statements: Income StatementFor the Month Ended October 31, 2021Revenue Sales 5,600 Less: Cost of Goods SoldPurchasesLess: Purchase Return Inventory, October 31, 2021 5,400(250)(320) (4,830) Gross Profit 770Rent Revenue 800Total Revenue 1,570Expenses: Repairs ExpenseWages ExpenseRent Expense 110820850 (1,780)Net Income (Loss) (210)Statement of Financial PositionOctober 31, 2021ASSETSCurrent AssetsCashCash in BankAccounts ReceivableInventory, October 31, 2021Total Current Assets 7,3408,030150320 15,840Non-Current AssetsOffice EquipmentFlatCarTotal Non-Current Assets 2,70045,00012,000 59,700TOTAL ASSETS 75,540 TOTAL LIABILITIES AND OWNER'S EQUITY Liabilities:Accounts PayableTotal Liabilities 5,150 5,150Owner's Equity:York, CapitalLess: York, Drawings Net Income (Loss)Total Owner's Equity 71,800(1,200)(210) 70,390TOTAL LIABILITIES & OWNER'S EQUITY 75,540 PART Ba) According to the information available in Income and Financial position statements in Part A, calculatethe following ratios for Anne's business for October 2021Competitors AverageCurrent Acid testNet profitmarginAccounts receivable Accountscollection periodGrossprofitmarginratioratiopayable16 Days28 Daysрaymentperiod27 Days12DaysYear 20190.320.552.71.34Year 20200.280.562.61.32Year 20210.020.082.81.3826 Days17 Daysb. Assuming Anne's competitor's ratio averages are as stated above for month October of years 2019,2020 and 2021: Analyse her performance with reference to the ratios of October 2021 calculated incomparison to those of her competitor. Also, briefly explain the impact of Covid -19 outbreak on theaverage ratios (Maximum of 500 words).

Name: Help me only with question b)Financial statements: Income StatementFor
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Description: Help me only with question b)Financial statements: Income StatementFor the Month Ended October 31, 2021Revenue Sales 5,600 Less: Cost of Goods SoldPurchasesLess: Purchase Return Inventory, October 31, 2021 5,400(250)(320) (4,830) Gross

Solution Working note 1- Net profit = (210) / 5600 = -3.75 2- Gross profit margin = 770 / 5600 =…

Answered: PART B a) According to the information…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 87BPSB

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Help me only with question b)

Financial statements:

Income Statement For the Month Ended October 31, 2021
Revenue
Sales		5,600
Less: Cost of Goods Sold Purchases Less: Purchase Return Inventory, October 31, 2021	5,400 (250) (320)	(4,830)
Gross Profit			770
Rent Revenue			800
Total Revenue			1,570
Expenses:
Repairs Expense Wages Expense Rent Expense		110 820 850	(1,780)
Net Income (Loss)			(210)

Statement of Financial Position October 31, 2021
ASSETS
Current Assets Cash Cash in Bank Accounts Receivable Inventory, October 31, 2021 Total Current Assets	7,340 8,030 150 320	15,840
Non-Current Assets Office Equipment Flat Car Total Non-Current Assets	2,700 45,000 12,000	59,700
TOTAL ASSETS		75,540

TOTAL LIABILITIES AND OWNER'S EQUITY
Liabilities: Accounts Payable Total Liabilities	5,150	5,150
Owner's Equity: York, Capital Less: York, Drawings Net Income (Loss) Total Owner's Equity	71,800 (1,200) (210)	70,390
TOTAL LIABILITIES & OWNER'S EQUITY		75,540

PART B
a) According to the information available in Income and Financial position statements in Part A, calculate
the following ratios for Anne's business for October 2021
Competitors Average
Current Acid test
Net profit
margin
Accounts receivable Accounts
collection period
Gross
profit
margin
ratio
ratio
payable
16 Days
28 Days
рayment
period
27 Days
12Days
Year 2019
0.32
0.55
2.7
1.34
Year 2020
0.28
0.56
2.6
1.32
Year 2021
0.02
0.08
2.8
1.38
26 Days
17 Days
b. Assuming Anne's competitor's ratio averages are as stated above for month October of years 2019,
2020 and 2021: Analyse her performance with reference to the ratios of October 2021 calculated in
comparison to those of her competitor. Also, briefly explain the impact of Covid -19 outbreak on the
average ratios (Maximum of 500 words).

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