1.Calculate the break‐even point for Pearson & Litt for 2019 and 2020. 2. Compare the results of the 2019 and 2020 break‐even point and explain why there might be a difference. 3. The current ratio reflects the relationship between the value of the current assets and the extent of the current liabilities of a business. 4. Calculate the current ratio for Pearson & Litt for 2019.
1.Calculate the break‐even point for Pearson & Litt for 2019 and 2020.
2. Compare the results of the 2019 and 2020 break‐even point and explain why there might be a difference.
3. The current ratio reflects the relationship between the value of the current assets and the extent of the current liabilities of a business.
4. Calculate the current ratio for Pearson & Litt for 2019.
5. Explain the results of the current‐test ratio. HINT: Include the minimum ratio recommended for the ratio in your answer.
6. The gross profit margin indicates how profitable sales have been.
7. Calculate the gross profit margin for Pearson & Litt for 2020.
8. Explain the results of the gross profit margin calculation.
9. Financial planning forms an integral part of the strategic planning of a firm.
10. Differentiate between traditional budgeting and zero‐base budgeting.
11. Recommend one of these budgeting methods to Pearson & Litt and provide reasons for your recommendation.
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