High-Tex Limited Income Statement for the year ending 30 June 2019 ($’000) 2018 ($’000) Revenue - computer 9,600 8,300 Revenue - software 1,450 1,500 Total operating revenue 11,050 9,800 Cost of sales 5,400 5,195 Gross profit 5,650 4,605 Administration expense 1,250 950 Wages expense 600 500 Depreciation expense 225 225 Other expenses 480 435 Earnings before interest and tax 3,095 2,495 Interest expense 455 525 Profit before tax 2,640 1,970 Income tax expense 792 591 Profit for the period from continuing operations 1,848 1,379 High-Tex Limited Balance Sheet as at 30 June 2,019 ($’000) 2,018 ($’000) Current assets Cash 1,450 2155 Accounts receivable 1455 1,045 Inventories 755 980 Total current assets 3,660 4,180 Non-current assets Property, plant and equipment 6,780 7,150 Intangible assets 550 451 Total non-current assets 7,330 7,601 Total assets 10,990 11,781 Current liabilities Accounts payable 735 1145 Income tax payable 650 685 Accrued expenses 815 995 Total current liabilities 2,200 2,825 Non-current liabilities Bank loans 3,700 4,100 Provisions 585 415 Total non-current liabilities 4,285 4,515 Total liabilities 6,485 7,340 Net assets 4,505 4,441 Equity Share capital 2,000 2,000 Retained earnings 2,505 2,441 Total Equity 4,505 4,441 Additional information: The total equity as at 30 June 2017 is $4,185,000. The inventory as at 30 June 2017 is $915,000. The accounts receivable as at 30 June 2017 is $1,055,000. Question: You have been invited to calculate the following ratios for the company: Financial Ratios 2019 2018 Return on Assets (ROA) % % Return on equity (ROE) % % Profit Margin % % Gross profit margin % % Inventory turnover times times Debtors turnover times times

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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High-Tex Limited
Income Statement for the year ending 30 June
	2019 ($’000)	2018 ($’000)
Revenue - computer	9,600	8,300
Revenue - software	1,450	1,500
Total operating revenue	11,050	9,800
Cost of sales	5,400	5,195
Gross profit	5,650	4,605
Administration expense	1,250	950
Wages expense	600	500
Depreciation expense	225	225
Other expenses	480	435
Earnings before interest and tax	3,095	2,495
Interest expense	455	525
Profit before tax	2,640	1,970
Income tax expense	792	591
Profit for the period from continuing operations	1,848	1,379

High-Tex Limited
Balance Sheet as at 30 June
	2,019 ($’000)	2,018 ($’000)
Current assets
Cash	1,450	2155
Accounts receivable	1455	1,045
Inventories	755	980
Total current assets	3,660	4,180
Non-current assets
Property, plant and equipment	6,780	7,150
Intangible assets	550	451
Total non-current assets	7,330	7,601
Total assets	10,990	11,781
Current liabilities
Accounts payable	735	1145
Income tax payable	650	685
Accrued expenses	815	995
Total current liabilities	2,200	2,825
Non-current liabilities
Bank loans	3,700	4,100
Provisions	585	415
Total non-current liabilities	4,285	4,515
Total liabilities	6,485	7,340
Net assets	4,505	4,441
Equity
Share capital	2,000	2,000
Retained earnings	2,505	2,441
Total Equity	4,505	4,441

Additional information:

The total equity as at 30 June 2017 is $4,185,000.
The inventory as at 30 June 2017 is $915,000.
The accounts receivable as at 30 June 2017 is $1,055,000.

Question: You have been invited to calculate the following ratios for the company:

Financial Ratios	2019	2018
Return on Assets (ROA)	%	%
Return on equity (ROE)	%	%
Profit Margin	%	%
Gross profit margin	%	%
Inventory turnover	times	times
Debtors turnover	times	times

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