Tilapia Ltd and Koobi Ltd are companies in the fish industry. Each of th4e companies devised several strategies to outperform the other. Tilapia Ltd decided to do more adverts in the various social media platform, on television and print media in order to boost its sales. It also employed more sales agents to distribute its products. Koobi Ltd in a bid to increase its market share decided to go in for a loan to expand its operation. It also reduced its selling Price and extended its credit period to attract more customers. Sales of GH₵ 800,000 and GH₵ 700,000 were recorded by Tilapia Ltd and Koobi Ltd respectively for the year 2018. The following financial reports were prepared for the year ended 31st December 2019. Statement of Profit or Loss for the year ended 31st December, 2019 Tilapia Ltd GH₵ Koobi Ltd GH₵ Sales 1,200,000 1,250,000 Cost of sales 400,000 650,000 Gross profit 800,000 600,000 Administrative Expenses 85,000 150,000 Selling & Distribution Expenses 250,000 125,000 Interest Expenses 20,000 100,000 Profit before tax 445,000 225,000 Taxation 111,250 56,250 Net profit after tax 333,750 168,750 Statement of Financial Position as at 31st December, 2019 Tilapia Ltd GH₵ Koobi Ltd GH₵ Non-Current Assets Property, Plant and Equipment 500,000 1,800,000 Investment 400,000 100,000 Total Non-Current Assets 900,000 1,900,000 Current Assets Inventory 80,000 200,000 Trade Receivables 85,000 300,000 91 days treasury bills 115,000 100,000 Bank 100,000 250,000 Total Current Assets 380,000 850,000 Total Assets 1,280,000 2,750,000 EQUITY & LIABILITIES Equity Stated Capital 500,000 500,000 Income Surplus 333,750 168,750 Total Equity 833,750 668,750 Non-Current Liabilities 10% Loan note 200,000 1,000,000 Current Liabilities Trade Payables 70,000 680,000 Accrued expenses 65,000 345,000 Tax Payable 111,250 56,250 Total Current Liabilities 246,250 1,081,250 Total Liabilities 446,250 2,081,250 Total Equity and Liabilities 1,280,000 2,750,000 Required: With the aid of common size financial statements, analyze the performance of Tilapia Ltd and Koobi Ltd for the year Ended 31st December 2019 commenting on the effective of their market strategies.

Tilapia Ltd and Koobi Ltd are companies in the fish industry. Each of th4e companies devised several strategies to outperform the other. Tilapia Ltd decided to do more adverts in the various social media platform, on television and print media in order to boost its sales. It also employed more sales agents to distribute its products. Koobi Ltd in a bid to increase its market share decided to go in for a loan to expand its operation. It also reduced its selling Price and extended its credit period to attract more customers. Sales of GH₵ 800,000 and GH₵ 700,000 were recorded by Tilapia Ltd and Koobi Ltd respectively for the year 2018. The following financial reports were prepared for the year ended 31st December 2019. Statement of Profit or Loss for the year ended 31st December, 2019 Tilapia Ltd GH₵ Koobi Ltd GH₵ Sales 1,200,000 1,250,000 Cost of sales 400,000 650,000 Gross profit 800,000 600,000 Administrative Expenses 85,000 150,000 Selling & Distribution Expenses 250,000 125,000 Interest Expenses 20,000 100,000 Profit before tax 445,000 225,000 Taxation 111,250 56,250 Net profit after tax 333,750 168,750 Statement of Financial Position as at 31st December, 2019 Tilapia Ltd GH₵ Koobi Ltd GH₵ Non-Current Assets Property, Plant and Equipment 500,000 1,800,000 Investment 400,000 100,000 Total Non-Current Assets 900,000 1,900,000 Current Assets Inventory 80,000 200,000 Trade Receivables 85,000 300,000 91 days treasury bills 115,000 100,000 Bank 100,000 250,000 Total Current Assets 380,000 850,000 Total Assets 1,280,000 2,750,000 EQUITY & LIABILITIES Equity Stated Capital 500,000 500,000 Income Surplus 333,750 168,750 Total Equity 833,750 668,750 Non-Current Liabilities 10% Loan note 200,000 1,000,000 Current Liabilities Trade Payables 70,000 680,000 Accrued expenses 65,000 345,000 Tax Payable 111,250 56,250 Total Current Liabilities 246,250 1,081,250 Total Liabilities 446,250 2,081,250 Total Equity and Liabilities 1,280,000 2,750,000 Required: With the aid of common size financial statements, analyze the performance of Tilapia Ltd and Koobi Ltd for the year Ended 31st December 2019 commenting on the effective of their market strategies.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter12: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 2CDQ

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Tilapia Ltd and Koobi Ltd are companies in the fish industry. Each of th4e companies devised several strategies to outperform the other.

Tilapia Ltd decided to do more adverts in the various social media platform, on television and print media in order to boost its sales. It also employed more sales agents to distribute its products.

Koobi Ltd in a bid to increase its market share decided to go in for a loan to expand its operation. It also reduced its selling Price and extended its credit period to attract more customers.

Sales of GH₵ 800,000 and GH₵ 700,000 were recorded by Tilapia Ltd and Koobi Ltd respectively for the year 2018.

The following financial reports were prepared for the year ended 31^st December 2019.

Statement of Profit or Loss for the year ended 31^st December, 2019

	Tilapia Ltd GH₵	Koobi Ltd GH₵
Sales	1,200,000	1,250,000
Cost of sales	400,000	650,000
Gross profit	800,000	600,000
Administrative Expenses	85,000	150,000
Selling & Distribution Expenses	250,000	125,000
Interest Expenses	20,000	100,000
Profit before tax	445,000	225,000
Taxation	111,250	56,250
Net profit after tax	333,750	168,750

Statement of Financial Position as at 31^st December, 2019

	Tilapia Ltd GH₵	Koobi Ltd GH₵
Non-Current Assets
Property, Plant and Equipment	500,000	1,800,000
Investment	400,000	100,000
Total Non-Current Assets	900,000	1,900,000
Current Assets
Inventory	80,000	200,000
Trade Receivables	85,000	300,000
91 days treasury bills	115,000	100,000
Bank	100,000	250,000
Total Current Assets	380,000	850,000
Total Assets	1,280,000	2,750,000
EQUITY & LIABILITIES
Equity
Stated Capital	500,000	500,000
Income Surplus	333,750	168,750
Total Equity	833,750	668,750
Non-Current Liabilities
10% Loan note	200,000	1,000,000
Current Liabilities
Trade Payables	70,000	680,000
Accrued expenses	65,000	345,000
Tax Payable	111,250	56,250
Total Current Liabilities	246,250	1,081,250
Total Liabilities	446,250	2,081,250
Total Equity and Liabilities	1,280,000	2,750,000

Required:

With the aid of common size financial statements, analyze the performance of Tilapia Ltd and Koobi Ltd for the year Ended 31^st December 2019 commenting on the effective of their market strategies.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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