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Problem 1: Viance Queen Company   Required: Compute for the company’s profitability and operating efficiency ratios for 2019 Compute for the financial health ratios of the company for 2019   A.Profitability ratio a.Gross Profit Ratio b. Operating income margin c. Net profit margin

Problem 1: Viance Queen Company   Required: Compute for the company’s profitability and operating efficiency ratios for 2019 Compute for the financial health ratios of the company for 2019   A.Profitability ratio a.Gross Profit Ratio b. Operating income margin c. Net profit margin

Corporate Financial Accounting
Corporate Financial Accounting
14th Edition
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter14: Financial Statement Analysis
Section: Chapter Questions
Problem 14.9BE
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Problem 1: Viance Queen Company
 
Required:
  1. Compute for the company’s profitability and operating efficiency ratios for 2019
  2. Compute for the financial health ratios of the company for 2019
 
A.Profitability ratio
a.Gross Profit Ratio
b. Operating income margin
c. Net profit margin
d. Return on Assets:
      • ROA (NI/Total Assets)
      • ROA (NI/Average Assets)
      • ROA (EBIT/Total Assets)
      • ROA (EBIT/Average Assets)
      • ROE (NI/Capital)
      • ROE (NI/Average Capital
 
B.Operating Efficiency
a. Asset Turnover
b. Fixed Asset Turnover
c. Inventory Turnover
d. Days in Inventory
e. AR Turnover
f. Days in AR
C.Financial Health/ (Solvency and Liquidity) Solvency ratio:
a. Debt to equity ratio
b. Debt Ratio
c. Equity Ratio
d. Interest Coverage Ratio
Liquidity ratio:
a. Current Ratio
b. Quick Ratio
Problem No. 1 Viance Queen Company Statement of Financial Position As of December 31 2019 2018 Cash Accounts Receivable Inventory Prepald Rent Delivery Van Total Assets 110,000 90,000 129,000 12,000 550,000 891,000 87,400 69,920 218,500 4,370 493,810 874,000 Accounts Payable Loan Payable Viance Queen, Capital Total Liabilities and Equity 75,000 400,000 416,000 891,000 67,298 393,300 413,402 874,000 Viance Queen Company Statement of Comprehensive Income For the Period Ended December 31 2019 2018 Sales Cost of Goods Sold Gross Profit Operating Expenses Interest Expense Net Income 810,000 348,300 461,700 234,900 40,500 186,300 686,000 301,750 384,250 205,800 17,150 161,300
Transcribed Image Text:Problem No. 1 Viance Queen Company Statement of Financial Position As of December 31 2019 2018 Cash Accounts Receivable Inventory Prepald Rent Delivery Van Total Assets 110,000 90,000 129,000 12,000 550,000 891,000 87,400 69,920 218,500 4,370 493,810 874,000 Accounts Payable Loan Payable Viance Queen, Capital Total Liabilities and Equity 75,000 400,000 416,000 891,000 67,298 393,300 413,402 874,000 Viance Queen Company Statement of Comprehensive Income For the Period Ended December 31 2019 2018 Sales Cost of Goods Sold Gross Profit Operating Expenses Interest Expense Net Income 810,000 348,300 461,700 234,900 40,500 186,300 686,000 301,750 384,250 205,800 17,150 161,300
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