Financial Math
On 1 October 2019 Manny Kyoor and his wife formed a limited company. Kyoor Ltd, to run a beautician’s business and each paid in $37500 as share capital. The bank loaned the company a further $80000 at 9% interest per annum.
At 30 September 2020 the business’s final accounts were drawn up as follows.
Trading and Profit and Loss Accounts for the year
Ended 30 September 2020
Sales and fees $350000
Less; Cost of sales
Stock bought on 1 October 2019 $ 31500
Purchases 280000
$311500
Stock at 30 September 2020 $66500 $245000
Gross Profit $105000
Less; Expenses
Rent and Rates $3950
Advertising 1750
Wages 29000
Heat and Light 5250
Interest due 7200
Depreciation 12000 $59150
Net Profit $45850
Balance Sheet as at 30 September 2020
Fixed Assets Cost Depreciation NBV
Premises $124000 $124000
Fixtures and Fittings $48000 $12000 $36000
$172000 $12000 $160000
Current Assets
Stock $66500
Debtors $21500 $88000
Amounts to be settled within one year
Creditors $21000
Interest due $7200
Bank $18950 $47150 $40850
$200850
Amount to be settled after more than one year
Long term Loan $80000
$120850
Share capital and Reserves
75000 ordinary shares of $1 $75000
Retained Profit $45850
$120850
Industry average ratios and other relevant data concerning businesses similar to Kyoor Ltd were as follows.
Gross Profit Margin 30.00%
Net Profit Margin 18.07%
Current Ratio 2.21:1
Liquid (Quick) Ratio 1.02:1
Stock Turnover Ratio 8 times
Fixed Assets to Sales 50.18%
Return on Total Assets 25.37%
Return on Net Assets 34.93%
Debtors’ Payment Period 25 days (365 days)
Creditors’ Payment Period 30 days (365 days)
a) Calculate each of the above ratios, to 2 decimal places, for Kyoor Ltd. Also calculate extended Du Pont ratio of Kyoor Lted
b) Comment on the businesses performance in the light of the data for the industry.
c) Note. It is not sufficient to say that a ratio is ‘higher’ or ‘lower’ than an industry average- it must be made clear whether you think it is better or worse than the industry average and you must give reasons for your comments.
Homework Answers
Request Answer!
We need at least 9 more requests to produce the answer.
1 / 10 have requested this problem solution
The more requests, the faster the answer.
Financial Indicators/Ratios 2018 2017 Current ratio ? 2.92 : 1 Acid test ratio ? 1.28 :...
Financial Indicators/Ratios 2018 2017 Current ratio ? 2.92 : 1 Acid test ratio ? 1.28 : 1 Debtors collection period ? 16 days Creditors payment period ? 27 days Inventory turnover rate ? 24 times/year Gross profit percentage ? 35% Net profit percentage ? 10,29% Return on equity ? 210,53% Debt equity ratio ? 0.74 Catwalksale (Pty) Ltd Extract from the statement of profit or loss and other comprehensive income for the year ending 31 December 2018: 2018 2017 Revenue...
For answering Questions 17 to 20, refer to the following figures extracted from the financial statements...
For answering Questions 17 to 20, refer to the following figures extracted from the financial statements of Blunt Ltd. Sales Cost of sales Profit before interest and tax Fixed assets Depreciation Stock Debtors Cash at bank Creditors Long-term loans 2,700 1,950 300 1,500 150 1,050 750 150 900 450 17) What is the quick ratio? a) 100-1 b) 217:1 c) 083-1 d) 333:1 e) none of the above 18) What is the net working capital? a) 1,050 b) 1,950 c)...
5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the...
5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the Statement of Financial Position of Glory Company for the year ended 2019, calculate the following ratios: (i) Net Profit Margin; Current Ratio; (iii) Acid Test Ratio; (iv) Debtors Collection Period (in days); (v) Creditors Payment Period (in days); and (vi) Inventory (Stock) Turnover. I (b) In the table labelled "TABLE A™ below, ratios of Praise Company for the same period, have been provided. Put...
5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the...
5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the Statement of Financial Position of Glory Company for the year ended 2019, calculate the following ratios: (i) Net Profit Margin; Current Ratio; (iii) Acid Test Ratio; (iv) Debtors Collection Period (in days); (v) Creditors Payment Period (in days); and (vi) Inventory (Stock) Turnover. I (b) In the table labelled "TABLE A™ below, ratios of Praise Company for the same period, have been provided. Put...
The comparative statements of Enchanted Ltd are presented here. ENCHANTED LTD Statement of profit or loss...
The comparative statements of Enchanted Ltd are
presented here.
ENCHANTED LTD
Statement of profit or loss
for the years ended 30 June
2019
2020
Net sales
$1340000
$1180000
Cost of sales
656600
542800
Gross profit
683400
637200
Selling and administrative expense
300696
439668
Finance costs
27336
57348
Profit before income tax
355368
140184
Income tax expense
95949
35046
Profit for the period
$259419
$105138
ENCHANTED LTD
Statement of financial position
as at 30 June
Assets
2019
2020
Current assets
Cash...
As an appointed Auditor, the company has provided you with following financial ratios for the year....
As an appointed Auditor, the company has provided you with following financial ratios for the year. Mobile X Ltd. Financial ratios Ratio Actual Budget (expected) Gross profit percentage 40% 45% Net profit percentage 25% 40% Trade payables ratio 70 days 30 days Current ratio 1.35:1 1.40:1 Acid test ratio 0.85:1 0.80:1 The company’s year end is the 31st March 2020. The auditor compared the planned and actual ratios for the company. Complete the table to indicate which ratios should be...
I have already posted the question, however, only four parts have been answered with missing data,...
I have already posted the
question, however, only four parts have been answered with missing
data, as well as not correct. Kindly, requesting you to help as
much as possible. I have an exam and I need an explanation.
Problem! A mount. Assets 1.00.000 Goodwil Amount 60,000 Liabilities Equity shares of $ 10 each Rosoves 20.000 Ficed Assets at cost Profit and loss account Secured loan Sundry Creditors Provision for action 30,000 Stock 80,000 Sundry deblors 50.000 Advances 20.000 Cash...
Cumi Ltd. and Ciki Ltd. are both computer component manufacturers in Longford. You are provided with...
Cumi Ltd. and Ciki Ltd. are both computer component manufacturers in Longford. You are provided with the following summarized information in relation to both companies. Income statements for year ended 31 March 2018 Cumi Lid. Cik Lid. AED'000 AED'000 Revenue 1.500 2000 Cost of sales 1.000 1.600 Gross profit 500 Operating expenses 150 200 Operating profit 350 200 Interest on debentures 100 50 Profit before tak 250 Tax SO Profit after tax 200 Dividends 70 Retained profits 350 30 120...
The following are the comparative accounts for MM Enterprise for the financial year 2018 and 2017:...
The following are the comparative accounts for MM Enterprise for the financial year 2018 and 2017: 2018 2017 Accounts (RM) 300,000 (RM) 250,000 Sales Cost of goods sold Expenses Net profit Equipment Cash 60,000 50,000 80,000 80,000 160,000 120,000 420,000 10,000 500,000 8,000 Inventories 30,000 40,000 Debtors 12,000 14,000 Prepaid expenses Creditors 4,000 3,000 10,000 15,000 Accrued expenses 10,000 6.000 Bank loan 150,000 100,000 Total Equities 410,000 400,000 Required: Calculate (use two decimal points) the following ratios for 2018: (a)...
'Second-Hands Ltd is a company that sells secondhand motor vehides. The owners (shareholders) of the business...
'Second-Hands Ltd is a company that sells secondhand motor vehides. The owners (shareholders) of the business are interested to know how the business has performed over the past two years and have you to report on the performance of the business, in particular on the liquidity of the business. You are provided with the following information: Average for the 2019 2020 industry Current ratio Current Assets/Current liabilities 3:1 2.5:1 2.3:1 + 1.5:1 0.8:1 1:1 Quick ratio (Cash assets + Receivables)/Current...
For answering Questions 17 to 20, refer to the following figures extracted from the financial statements of Blunt Ltd. Sales Cost of sales Profit before interest and tax Fixed assets Depreciation Stock Debtors Cash at bank Creditors Long-term loans 2,700 1,950 300 1,500 150 1,050 750 150 900 450 17) What is the quick ratio? a) 100-1 b) 217:1 c) 083-1 d) 333:1 e) none of the above 18) What is the net working capital? a) 1,050 b) 1,950 c)...
5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the Statement of Financial Position of Glory Company for the year ended 2019, calculate the following ratios: (i) Net Profit Margin; Current Ratio; (iii) Acid Test Ratio; (iv) Debtors Collection Period (in days); (v) Creditors Payment Period (in days); and (vi) Inventory (Stock) Turnover. I (b) In the table labelled "TABLE A™ below, ratios of Praise Company for the same period, have been provided. Put...
5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the Statement of Financial Position of Glory Company for the year ended 2019, calculate the following ratios: (i) Net Profit Margin; Current Ratio; (iii) Acid Test Ratio; (iv) Debtors Collection Period (in days); (v) Creditors Payment Period (in days); and (vi) Inventory (Stock) Turnover. I (b) In the table labelled "TABLE A™ below, ratios of Praise Company for the same period, have been provided. Put...
The comparative statements of Enchanted Ltd are
presented here.
ENCHANTED LTD
Statement of profit or loss
for the years ended 30 June
2019
2020
Net sales
$1340000
$1180000
Cost of sales
656600
542800
Gross profit
683400
637200
Selling and administrative expense
300696
439668
Finance costs
27336
57348
Profit before income tax
355368
140184
Income tax expense
95949
35046
Profit for the period
$259419
$105138
ENCHANTED LTD
Statement of financial position
as at 30 June
Assets
2019
2020
Current assets
Cash...
I have already posted the
question, however, only four parts have been answered with missing
data, as well as not correct. Kindly, requesting you to help as
much as possible. I have an exam and I need an explanation.
Problem! A mount. Assets 1.00.000 Goodwil Amount 60,000 Liabilities Equity shares of $ 10 each Rosoves 20.000 Ficed Assets at cost Profit and loss account Secured loan Sundry Creditors Provision for action 30,000 Stock 80,000 Sundry deblors 50.000 Advances 20.000 Cash...
Cumi Ltd. and Ciki Ltd. are both computer component manufacturers in Longford. You are provided with the following summarized information in relation to both companies. Income statements for year ended 31 March 2018 Cumi Lid. Cik Lid. AED'000 AED'000 Revenue 1.500 2000 Cost of sales 1.000 1.600 Gross profit 500 Operating expenses 150 200 Operating profit 350 200 Interest on debentures 100 50 Profit before tak 250 Tax SO Profit after tax 200 Dividends 70 Retained profits 350 30 120...
The following are the comparative accounts for MM Enterprise for the financial year 2018 and 2017: 2018 2017 Accounts (RM) 300,000 (RM) 250,000 Sales Cost of goods sold Expenses Net profit Equipment Cash 60,000 50,000 80,000 80,000 160,000 120,000 420,000 10,000 500,000 8,000 Inventories 30,000 40,000 Debtors 12,000 14,000 Prepaid expenses Creditors 4,000 3,000 10,000 15,000 Accrued expenses 10,000 6.000 Bank loan 150,000 100,000 Total Equities 410,000 400,000 Required: Calculate (use two decimal points) the following ratios for 2018: (a)...
'Second-Hands Ltd is a company that sells secondhand motor vehides. The owners (shareholders) of the business are interested to know how the business has performed over the past two years and have you to report on the performance of the business, in particular on the liquidity of the business. You are provided with the following information: Average for the 2019 2020 industry Current ratio Current Assets/Current liabilities 3:1 2.5:1 2.3:1 + 1.5:1 0.8:1 1:1 Quick ratio (Cash assets + Receivables)/Current...
Most questions answered within 3 hours.
-
Calculate the number density of argon gas at a temperature of
24C and a pressure of...
asked 2 hours ago -
Alternative
Classification
How to Estimate
Probabilities from Data? ( For continuous Attributes)
And How to generate...
asked 2 hours ago -
An explosion breaks a 20.0-kg object into three parts. The
object is initially moving at a...
asked 2 hours ago -
Calculate the approximate number of residues of Rubisco, which
is involved in carbon fixation in plants,...
asked 3 hours ago -
Other decisions about scientific claims can have a much broader
impact.ENERGYarrow-10x10.png, environment, health, security - all...
asked 4 hours ago -
I need to write a research paper and work cited about this
topic: The United States...
asked 5 hours ago -
Hello! I was wondering if I could have some help?
If the vapor pressure of carvone...
asked 5 hours ago -
An economist wants to estimate the mean per capita income (in
thousands of dollars) for a...
asked 5 hours ago -
What would be the input/output characteristic of a circuit
obtained by putting two of your 2's-complementers...
asked 5 hours ago -
In Drosophila, the transition from the syncytial blastoderm
stage to the cellular blastoderm stage is a...
asked 6 hours ago -
Project management question:
Name 3 different types of resources (hint: humans are one
type)
asked 6 hours ago -
Consider the following reaction: C 2H 2( g) + 2H 2( g) C 2H 6(
g)...
asked 6 hours ago