Calculate the profitability ratios for 2019 and 2020 for Eenyanyu Ltd. 1.2 Critically evaluate the management efficiency and performance of Eenyanyu Ltd for the years 2019 and 2020.
Question 1
Below are the summarized financial statements of Eenyanyu Limited, a construction company based in Oshakati in the northern part of Namibia for the years ended 30 July 2019 and 2020.
Eenyanyu Limited Statement of Profit and Loss and other Comprehensive Income
|
|
2020 N$000 |
2019 N$000 |
|
Opening inventories: Materials |
1 320 |
720 |
|
Purchases |
4 560 |
4 800 |
|
|
5 880 |
5 520 |
|
Closing inventories: Materials |
(1 320) |
(5 520) |
|
Material consumed |
4 560 |
4 560 |
|
Labour |
2 760 |
2 340 |
|
|
3 084 |
2 598 |
|
Total Cost of Production |
10 404 |
9 498 |
|
Opening finished product |
3 240 |
2 124 |
|
|
13 644 |
11 622 |
|
Closing finished products |
(5 640) |
(6 420) |
|
Cost of sales |
8 004 |
5 202 |
|
Gross profit |
1 626 |
853 |
|
Sales |
9 630 |
6 055 |
|
Administrative costs |
252 |
240 |
|
Selling costs |
300 |
288 |
|
Interest on bank overdraft |
96 |
36 |
|
Profit after tax |
778 |
187 |
|
Tax rate |
28% |
28% |
Eenyanyu Limited Statement of Financial Position
|
|
2020 N$000 |
|
2019 N$000 |
|
|
Equipment (carrying amount) |
|
3 480 |
|
3 360 |
|
Inventories |
|
6 960 |
|
4 560 |
|
Receivables |
|
4 200 |
|
3 600 |
|
|
|
14 640 |
|
11 520 |
|
Issued share capital |
|
1 200 |
|
1 200 |
|
Share premium |
|
960 |
|
960 |
|
Retained income |
|
4 920 |
|
5 232 |
|
Bank overdraft |
|
4 800 |
|
1 920 |
|
Payables |
|
2 760 |
|
2 208 |
|
|
|
14 640 |
|
11 520 |
|
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1.1 |
Calculate the profitability ratios for 2019 and 2020 for Eenyanyu Ltd. |
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1.2 |
Critically evaluate the management efficiency and performance of Eenyanyu Ltd for the years 2019 and 2020.
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