Statement of financial position of XYZ Ltd for the year ended 31 December 201820182017AssetsNon-current assets1 2651 300Current assetsInventory17765002189500Trade and other receivables200400Cash and cash equivalents1489876Total assets3 4543 076Equity and liabilitiiesShareholders equityOrdinary shares10001000Share premium200200Retained profit1 024576Non-current liabilities7501000Current liabilities480300Trade and other payables200100Accrued expenses200150Shareholders for dividends8050Total equity and liabilities3 4543 076NOTES:• All sales are on credit• Assume a 365-day financial yearREQUIRED:Calculate the following ratios for 2017 and 2018 and also state if there was an improvement or detoriation in thecalculated ratio:5.1 Gross profit margin5.2 Acid test (quick) ratio5.3 Cash conversion cycle QUESTION 5Statement of comprehensive income of XYZ Ltd for the year ended 31 December 201820182017SalesCost of sales4 00012 0002 0006 000Gross profit2 0006 000Operating expenses10005000Operating profit1 0001 000Interest and other income100200Earnings before interest and taxation900800Тахation252224Net profit after taxation648576Preference dividendsEarnings available to ordinary shareholders648576Ordinary dividends200100Retained profit for the year448476Retained profit (1 Jan)576100Retained profit (31 Dec)1 024576

Following are the requisite ratios

QUESTION 5 Statement of comprehensive income of XYZ Ltd for the year ended 31 December 2018 2018 4 000 2 000 2017 Sales 12 000 Cost of sales Gross profit Operating expenses Operating profit Interest and other income 6 000 2 000 6 000 1000 5000 1 000 1 000 100 200 Earnings before interest and taxation 900 800 Taxation 252 224 Net profit after taxation 648 576 Preference dividends Earnings available to ordinary shareholders 648 576 Ordinary dividends 200 100 Retained profit for the year 448 476 Retained profit (1 Jan) 576 100 Retained profit (31 Dec) 1 024 576

QUESTION 5 Statement of comprehensive income of XYZ Ltd for the year ended 31 December 2018 2018 4 000 2 000 2017 Sales 12 000 Cost of sales Gross profit Operating expenses Operating profit Interest and other income 6 000 2 000 6 000 1000 5000 1 000 1 000 100 200 Earnings before interest and taxation 900 800 Taxation 252 224 Net profit after taxation 648 576 Preference dividends Earnings available to ordinary shareholders 648 576 Ordinary dividends 200 100 Retained profit for the year 448 476 Retained profit (1 Jan) 576 100 Retained profit (31 Dec) 1 024 576

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 14.26EX: Comprehensive Income Anson Industries, Inc. reported the following information on its 20Y1 income...

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