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Business
Accounting
Liquidity Status Current Ratios Quick Asset Ratios Efficiency Status Asset Turnover Fixed Asset Turnover Inventory Turnover Days in Inventory Accounts Receivable Turnover Days in Receivable Profitability Status: Gross Profit margin Ratio Operating Income Ratio Net Profit Ratio Return on Assets Return on Equity

Liquidity Status Current Ratios Quick Asset Ratios Efficiency Status Asset Turnover Fixed Asset Turnover Inventory Turnover Days in Inventory Accounts Receivable Turnover Days in Receivable Profitability Status: Gross Profit margin Ratio Operating Income Ratio Net Profit Ratio Return on Assets Return on Equity

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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Financial Ratios: Do Year 2022 only

  1. Liquidity Status
    1. Current Ratios
    2. Quick Asset Ratios
  2. Efficiency Status
    1. Asset Turnover
    2. Fixed Asset Turnover
    3. Inventory Turnover
    4. Days in Inventory
    5. Accounts Receivable Turnover
    6. Days in Receivable
  3. Profitability Status:
    1. Gross Profit margin Ratio
    2. Operating Income Ratio
    3. Net Profit Ratio
    4. Return on Assets
    5. Return on Equity
M2MTrading Company Comparative Statement of Financial Position For the Years Ended December 31, 2021 and 2021 Vertical Analysis 2022 2021 Assets Current Assets: Cash & Cash Equivalents Trading Securities P12,445 P1,060 5,000 8,000 4,000 3,000 5,000 300 Trade and Other Receivables Merchandise Inventory Prepaid Expenses 480 Total Current Assets P29,925 P9,360 Non-Current Assets: Investment in MCM Corporation P8,000 P10,000 Property, Plant & Equipment (Net of Accumulated Depreciation): Building P47,000 12,000 P50,000 Office Equipment 15,000 15,640 Furniture and Fixtures 16,000 Total Non-current Assets P83,000 P90,640 Total Assets P112,925 P100,000 ====== ======= Liabilities and Owner's Equity Current Liabilities Trade and Other Payables P4,200 5,300 P1,675 Income Tax Payable 5,825 Accrued Expenses 450 300 Total Current Liabilities P9,950 P7,800 Non-Current Liability Loans Payable (payable 2024) 36,775 50,000 Total Liabilities P46,725 P57,800 Owner's Equity Р66,200 P42,200 Total Liabilities and Owner's Equity P112,925 P100,000 ======= ======
Transcribed Image Text:M2MTrading Company Comparative Statement of Financial Position For the Years Ended December 31, 2021 and 2021 Vertical Analysis 2022 2021 Assets Current Assets: Cash & Cash Equivalents Trading Securities P12,445 P1,060 5,000 8,000 4,000 3,000 5,000 300 Trade and Other Receivables Merchandise Inventory Prepaid Expenses 480 Total Current Assets P29,925 P9,360 Non-Current Assets: Investment in MCM Corporation P8,000 P10,000 Property, Plant & Equipment (Net of Accumulated Depreciation): Building P47,000 12,000 P50,000 Office Equipment 15,000 15,640 Furniture and Fixtures 16,000 Total Non-current Assets P83,000 P90,640 Total Assets P112,925 P100,000 ====== ======= Liabilities and Owner's Equity Current Liabilities Trade and Other Payables P4,200 5,300 P1,675 Income Tax Payable 5,825 Accrued Expenses 450 300 Total Current Liabilities P9,950 P7,800 Non-Current Liability Loans Payable (payable 2024) 36,775 50,000 Total Liabilities P46,725 P57,800 Owner's Equity Р66,200 P42,200 Total Liabilities and Owner's Equity P112,925 P100,000 ======= ======
Chiz Trading Company Comparative Statement of Comprehensive Income For the Years Ended December 31, 2022 and 2021 (In Thousand pesos) Horizontal Analysis Inc (Dec Amoun Change 2022 2021 240.0 200.0 Sales 40.00 20.00% 182.0 140.0 Less: Cost of Good sold 42.00 30.00% Gross Profit 58.00 60.00 -2.00 -3.33% Less: Operating Expense Selling 17.00 18.00 -1.00 -5.56% General and Administrative 11.80 14.00 -2.20 -15.71% Total Operating Expense 28.80 32.00 -3.20 -10.00% Net Operating Income 29.20 28.00 1.20 4.29% Add: Other Income and Expense Interest Income 7.50 4.80 2.70 56.25% Interest Expense -7.40 -9.50 2.10 -22.11% Net Income 29.30 23.30 6.00 25.75% Step 3 Chiz Trading Company Comparative Statement of Comprehensive Income For the Years Ended December 31, 2022 and 2021 (In Thousand pesos) Vertical Analysis 2022 % 2021 Sales 240.00 100.00% 200.00 100.00% Less: Cost of Good sold 182.00 75.83% 140.00 70.00% Gross Profit 58.00 24.17% 60.00 30.00% Less: Operating Expense Selling 17.00 7.08% 18.00 9.00% General and Administrative 11.80 4.92% 14.00 7.00% Total Operating Expense 28.80 12.00% 32.00 16.00% Net Operating Income Add: Other Income and Expense 29.20 12.17% 28.00 14.00% Interest Income 7.50 3.13% 4.80 2.40% Interest Expense -7.40 -3.08% -9.50 -4.75% Net Income 29.30 12.21% 23.30 11.65%
Transcribed Image Text:Chiz Trading Company Comparative Statement of Comprehensive Income For the Years Ended December 31, 2022 and 2021 (In Thousand pesos) Horizontal Analysis Inc (Dec Amoun Change 2022 2021 240.0 200.0 Sales 40.00 20.00% 182.0 140.0 Less: Cost of Good sold 42.00 30.00% Gross Profit 58.00 60.00 -2.00 -3.33% Less: Operating Expense Selling 17.00 18.00 -1.00 -5.56% General and Administrative 11.80 14.00 -2.20 -15.71% Total Operating Expense 28.80 32.00 -3.20 -10.00% Net Operating Income 29.20 28.00 1.20 4.29% Add: Other Income and Expense Interest Income 7.50 4.80 2.70 56.25% Interest Expense -7.40 -9.50 2.10 -22.11% Net Income 29.30 23.30 6.00 25.75% Step 3 Chiz Trading Company Comparative Statement of Comprehensive Income For the Years Ended December 31, 2022 and 2021 (In Thousand pesos) Vertical Analysis 2022 % 2021 Sales 240.00 100.00% 200.00 100.00% Less: Cost of Good sold 182.00 75.83% 140.00 70.00% Gross Profit 58.00 24.17% 60.00 30.00% Less: Operating Expense Selling 17.00 7.08% 18.00 9.00% General and Administrative 11.80 4.92% 14.00 7.00% Total Operating Expense 28.80 12.00% 32.00 16.00% Net Operating Income Add: Other Income and Expense 29.20 12.17% 28.00 14.00% Interest Income 7.50 3.13% 4.80 2.40% Interest Expense -7.40 -3.08% -9.50 -4.75% Net Income 29.30 12.21% 23.30 11.65%
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