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FINANCIAL RATIOS QUESTION 1 The following financial statements were prepared by the accountants of KOOWOOD Company Limited KOOWOÓD Company Limited Statement of Profit or Loss and Retained Earnings for the year ended 31s* December, 2018 GH¢ 1,360,000 GH¢ Sales Less cost of sales: Opening Inventory Add purchases 331,500 969,000 1,300,500 (484,500) (816,000) 544,000 Less closing Inventory Gross profit Administration expenses Selling and distribution expenses Operating profit Financial expenses Net profit for the year Dividend paid 260,000 200,000 460,000 84,000 (16,000) 68,000 (51,000) 17,000 25,500 42,500 Income surplus b/f Income surplus c/f *ignore taxation Statement of financial position as at 31st December, 2018 GH¢ GH¢ GH¢ 510,000 Non Current Assets at Cost Less depreciation 170,000 340,000 Current Assets: Inventory Trade Receivables Cash and bank 484,500 187,000 93,500 765,000 Current liabilities: Trade Payables Working Capital Capital Employed (255,000) 510,000 850,000 Financed by: Stated capital Income surplus 680,000 42,500 722,500 Non-current liability 7% loạn Note 127,500 850,000 Earnings per share GH¢0.10 Current market price/share GH¢2.00 You are required to calculate for KOOWOOD Limited Company the following (a.) Current ratio; (b.) Acid test ratio; (c.) Debtors collection period (in months); (d.) Creditors payment period (in months); (e.) Rate of stock turnover; (f) Return on Capital Employed (g) Net profit margin (h) Gross profit margin (1) Price/Earnings ratio

FINANCIAL RATIOS QUESTION 1 The following financial statements were prepared by the accountants of KOOWOOD Company Limited KOOWOÓD Company Limited Statement of Profit or Loss and Retained Earnings for the year ended 31s* December, 2018 GH¢ 1,360,000 GH¢ Sales Less cost of sales: Opening Inventory Add purchases 331,500 969,000 1,300,500 (484,500) (816,000) 544,000 Less closing Inventory Gross profit Administration expenses Selling and distribution expenses Operating profit Financial expenses Net profit for the year Dividend paid 260,000 200,000 460,000 84,000 (16,000) 68,000 (51,000) 17,000 25,500 42,500 Income surplus b/f Income surplus c/f *ignore taxation Statement of financial position as at 31st December, 2018 GH¢ GH¢ GH¢ 510,000 Non Current Assets at Cost Less depreciation 170,000 340,000 Current Assets: Inventory Trade Receivables Cash and bank 484,500 187,000 93,500 765,000 Current liabilities: Trade Payables Working Capital Capital Employed (255,000) 510,000 850,000 Financed by: Stated capital Income surplus 680,000 42,500 722,500 Non-current liability 7% loạn Note 127,500 850,000 Earnings per share GH¢0.10 Current market price/share GH¢2.00 You are required to calculate for KOOWOOD Limited Company the following (a.) Current ratio; (b.) Acid test ratio; (c.) Debtors collection period (in months); (d.) Creditors payment period (in months); (e.) Rate of stock turnover; (f) Return on Capital Employed (g) Net profit margin (h) Gross profit margin (1) Price/Earnings ratio

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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12:41 A Edit 50 FINANCIAL RATIOS QUESTION 1 The following financial statements were prepared by the accountants of KOOWOOD Company Limited KOowoÓD Company Limited Statement of Profit or Loss and Retained Earnings for the year ended 31st December, 2018 GH¢ GH¢ 1,360,000 Sales Less cost of sales: Opening Inventory Add purchases 331,500 969,000 1,300,500 (484,500) Less closing Inventory Gross profit Administration expenses Selling and distribution expenses Operating profit Financial expenses Net profit for the year Dividend paid (816,000) 544,000 260,000 200,000 460,000 84,000 (16,000) 68.000 (51,000) 17,000 25,500 42,500 Income surplus b/f Income surplus c/f *ignore taxation Statement of financial position as at 31st December, 2018 GH¢ GH¢ GHC Non Current Assets at Cost 510,000 Less depreciation 170,000 340,000 Current Assets: Inventory Trade Receivables Cash and bank 484,500 187,000 93,500 765,000 Current liabilities: Trade Payables Working Capital Capital Employed (255,000) 510,000 850,000 Financed by: Stated capital Income surplus 680,000 42,500 722,500 Non-current liability 7% loạn Note 127,500 850,000 Earnings per share GH¢0.10 Current market price/share GH¢2.00 You are required to calculate for KOOWOOD Limited Company the following (a.) Current ratio%3; (b.) Acid test ratio; (c.) Debtors collection period (in months); (d.) Creditors payment period (in months); (e.) Rate of stock turnover; (f) Return on Capital Employed (g) Net profit margin (h) Gross profit margin (i) Price/Earnings ratio DO Tools Mobile View Share
Transcribed Image Text:12:41 A Edit 50 FINANCIAL RATIOS QUESTION 1 The following financial statements were prepared by the accountants of KOOWOOD Company Limited KOowoÓD Company Limited Statement of Profit or Loss and Retained Earnings for the year ended 31st December, 2018 GH¢ GH¢ 1,360,000 Sales Less cost of sales: Opening Inventory Add purchases 331,500 969,000 1,300,500 (484,500) Less closing Inventory Gross profit Administration expenses Selling and distribution expenses Operating profit Financial expenses Net profit for the year Dividend paid (816,000) 544,000 260,000 200,000 460,000 84,000 (16,000) 68.000 (51,000) 17,000 25,500 42,500 Income surplus b/f Income surplus c/f *ignore taxation Statement of financial position as at 31st December, 2018 GH¢ GH¢ GHC Non Current Assets at Cost 510,000 Less depreciation 170,000 340,000 Current Assets: Inventory Trade Receivables Cash and bank 484,500 187,000 93,500 765,000 Current liabilities: Trade Payables Working Capital Capital Employed (255,000) 510,000 850,000 Financed by: Stated capital Income surplus 680,000 42,500 722,500 Non-current liability 7% loạn Note 127,500 850,000 Earnings per share GH¢0.10 Current market price/share GH¢2.00 You are required to calculate for KOOWOOD Limited Company the following (a.) Current ratio%3; (b.) Acid test ratio; (c.) Debtors collection period (in months); (d.) Creditors payment period (in months); (e.) Rate of stock turnover; (f) Return on Capital Employed (g) Net profit margin (h) Gross profit margin (i) Price/Earnings ratio DO Tools Mobile View Share
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