a) Calculate the following ratios for 2016 and 2015, showing detailed calculations as to how you arrive at each number. A ROE B Gross profit margin C Total asset turnover D Inventory turnover E Current ratio F Debt-to-equity G Interest coverage ratio. b) Using the financial statements and the ratios calculated above (and any other ratios you like to calculate), discuss the performance of Cobham PLC in 2016. c) Critically discuss the need for the public limited companies to prepare a Statement of Cash Flows and explain the usefulness of the information contained therein from the perspective of a financial analyst.
a) Calculate the following ratios for 2016 and 2015, showing detailed calculations as to how you arrive at each number. A ROE B Gross profit margin C Total asset turnover D Inventory turnover E Current ratio F Debt-to-equity G Interest coverage ratio. b) Using the financial statements and the ratios calculated above (and any other ratios you like to calculate), discuss the performance of Cobham PLC in 2016. c) Critically discuss the need for the public limited companies to prepare a Statement of Cash Flows and explain the usefulness of the information contained therein from the perspective of a financial analyst.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
a) Calculate the following ratios for 2016 and 2015, showing detailed calculations as to how you arrive at each number.
A ROE
B Gross profit margin
C Total asset turnover
D Inventory turnover
E
F Debt-to-equity
G Interest coverage ratio.
b) Using the financial statements and the ratios calculated above (and any other ratios you like to calculate), discuss the performance of Cobham PLC in 2016.
c) Critically discuss the need for the public limited companies to prepare a Statement of
![Below you will find the financials of Cobham PLC for 2014-2016:
Income statement £m
2016
2015
2014
Revenue
2,072.0
(1,567.3) (1,408.2) (1,290.1)
663.8
1,943.9
1,851.7
Cost of sales
Gross profit
SG&A
376.6
561.6
(1,155.7)
(779.1)
4.1
(651.8)
12.0
(504.0)
57.6
Operating (loss) profit
Finance income
5.2
6.4
(39.7)
24.3
Finance cost
(72.9)
(847.9)
52.8
(795.1)
(57.0)
(39.8)
2.1
(37.7)
(Loss)/profit before taxation
Тахation
4.7
29.0
(Loss)/profit after taxation
Balance sheet £m
Non-current assets
PPE & Intangibles
Investment properties
Investment in joint ventures and associates
Trade and other receivables
Deferred tax asset
2016
2015
2014
1,588.8
2,109.4
4.3
3.0
2,430.8
10.4
3.1
3.6
3.6
66.0
42.3
71.3
11.4
51.1
10.5
12.6
2,212.0
Financial assets
25.8
1,730.1
13.7
2,519.6
Current assets
Inventories
405.3
410.4
429.5
Trade and other receivables
409.8
366.0
435.3
Current tax receivables
3.1
8.6
0.4
Financial assets (including cash)
244.7
1,062.9
320.6
1,105.6
236.4
1,101.6
Current liabilities
Borrowings and other financial liabilities
Trade and other payables
103.1
199.7
22.2
398.1
505.5
Provisions
180.6
74.3
60.5
Current tax liabilities
149.5
864.0
125.1
797.2
119.2
707.4
Non-current liabilities
1,462.3
36.2
Borrowings and other financial liabilities
Trade and other payables
Provisions
Deferred tax liabilities
1,235.7
31.5
1,359.0
24.8
68.2
57.3
27.6
66.5
134.5
102.0
1,801.5
102.0
Retirement benefit obligations
87.0
1,439.1
56.7
1,610.7
Equity
489.9
909.7
1112.3](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F49ea8d17-fdbd-4ee2-9113-5f464d1355bf%2F83773455-0296-4c2e-85ed-cb120e03209e%2F0lovn6q_processed.png&w=3840&q=75)
Transcribed Image Text:Below you will find the financials of Cobham PLC for 2014-2016:
Income statement £m
2016
2015
2014
Revenue
2,072.0
(1,567.3) (1,408.2) (1,290.1)
663.8
1,943.9
1,851.7
Cost of sales
Gross profit
SG&A
376.6
561.6
(1,155.7)
(779.1)
4.1
(651.8)
12.0
(504.0)
57.6
Operating (loss) profit
Finance income
5.2
6.4
(39.7)
24.3
Finance cost
(72.9)
(847.9)
52.8
(795.1)
(57.0)
(39.8)
2.1
(37.7)
(Loss)/profit before taxation
Тахation
4.7
29.0
(Loss)/profit after taxation
Balance sheet £m
Non-current assets
PPE & Intangibles
Investment properties
Investment in joint ventures and associates
Trade and other receivables
Deferred tax asset
2016
2015
2014
1,588.8
2,109.4
4.3
3.0
2,430.8
10.4
3.1
3.6
3.6
66.0
42.3
71.3
11.4
51.1
10.5
12.6
2,212.0
Financial assets
25.8
1,730.1
13.7
2,519.6
Current assets
Inventories
405.3
410.4
429.5
Trade and other receivables
409.8
366.0
435.3
Current tax receivables
3.1
8.6
0.4
Financial assets (including cash)
244.7
1,062.9
320.6
1,105.6
236.4
1,101.6
Current liabilities
Borrowings and other financial liabilities
Trade and other payables
103.1
199.7
22.2
398.1
505.5
Provisions
180.6
74.3
60.5
Current tax liabilities
149.5
864.0
125.1
797.2
119.2
707.4
Non-current liabilities
1,462.3
36.2
Borrowings and other financial liabilities
Trade and other payables
Provisions
Deferred tax liabilities
1,235.7
31.5
1,359.0
24.8
68.2
57.3
27.6
66.5
134.5
102.0
1,801.5
102.0
Retirement benefit obligations
87.0
1,439.1
56.7
1,610.7
Equity
489.9
909.7
1112.3
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