Provide explanationations on the gearing and interest coverage ratios by making comparison between 2021 and 2022 Return on Equity*Return on Capital Employed*Gross profit marginOperating profit marginInterest coverCurrent ratioQuick ratioInventories turnover period*Settlement period for accountsreceivable*Settlement period for accounts payable*Operating cash cycleGearing202216%16.35%37.3%9.4%2.90.690.0372.1 days1.4 days97.2 days?51.5%202129.4%21.6%38.7%13.3%60.710.0962.9 days1.5 days89.3 days?54.9%

The interest coverage ratios are one of the ratios which a company measures so that it will be help…

Answered: Provide explanationations on the…

Business

Accounting

Provide explanationations on the gearing and interest coverage ratios by making comparison between 2021 and 2022

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Insurance of last year in adjustment where to adjust that insurance?

A: Adjusting Entry – Adjusting Entries are the entries that make the accrual principle work for the…

Q: Provide strategies you can suggest that may assist in maximizing the age pension entitlement.

A: Retirement planning" is the process of preparing financially for a comfortable and secure…

Q: Define 401(k) retirement plan

A: A 401(k) plan refers to a tax qualified defined contribution pension (or retirement) account.

Q: what was austal limited 2019 assest

A: Austal limited is a company involved in business of shipbuilding.

Q: There are four security interests listed below. Which will have first priority? Group of answer…

A: Explanation: The purchase money security interest concept relates to a legal claim that helps a…

Q: Cleveland Company has a stock portfolio valued at $4,000. Its cost was $3,300. If the Securities…

A: Journal entries refer to the recording of transactions in an appropriate way. With the help of…

Q: Define each of the following terms: i. The euro

A: The European Economic and Monetary Union (EMU), or EU, comprises of 28 part countries, of which 19…

Q: Identify the types of information that can readily be deter-mined from an amortization table for an…

A: Meaning of amortization table Amortization table is a table which consists of all the details…

Q: Explain Lease Renewal Options and REIT Rent Growth?

A: Answer: Lease renewal option: A renewal option allows a lease to apply for a definite time period,…

Q: Discuss the primary differences between U.S. GAAP and IFRS with respect to investments.

A: GAAP: It is the standard guidelines that are commonly used for financial reporting. These guidelines…

Q: Where can we obtain reliable guidelines on IFRS lease accounting?

A: It is dealing with where can we obtain reliable guidelines on IFRS lease accounting

Q: Which of the following earns a fixed rate of return? Whole life insurance. Term-life insurance.…

A: There are two main types of life insurance:- Term life insurance and whole life insurance. Term life…

Q: Define spot rate (foreign exchange)

A: Spot rate (foreign exchange): Spot rate is the present exchange rate at which a pair of currency…

Q: The interest of a compound interest investmeut or loan can be computed with the formula 1-A-P. The…

A: Because you have posted multiple questions, we will answer the first question only. For the…

Q: Explaining mortgage rates a. Compare the rate paid by a homeowner on a 30-year mortgage to the…

A: Interest rates for house loans, specifically those for the amount borrowed to buy or refinance a…

Q: Obligations payable within one year or one operating cycle, whichever is longer, are; Select one:…

A: Current liabilities: Liabilities which have to be paid within one year or one operating cycle,…

Q: Discuss the accounting for premiums under IFRS 15.

A: Under IFRS 15, businesses must account for premiums as revenue when the underlying goods or services…

Q: Name and describe the benfits/features of annuity due, ordinary annuity, and perpetuity.

A: A series of equal payments that take place annually is referred as annuity. Perpetuity is referred…

Q: What were the major effects of SFAS No. 106 on reporting for post-retirement benefits other than…

A: In accordance with this Statement, employers must account for post-retirement benefits besides just…

Q: 1.) What is Target’s current ratio for 2020? 2019? Did it increase or decrease? What does that tell…

A: To calculate Target's current ratio for 2020 and 2019, we'll use the formula:Current Ratio = Current…

Q: Which type of retirement plans are subject to contribution limits? Select one: a. Only defined…

A: Defined contribution plans refers to the plan under which both the employee and employer contribute…

Q: Discuss the primary differences between U.S. GAAP and IFRS with respect to accounting for…

A: Under IFRS, defined benefit plan assets are valued at fair value. Under U.S. GAAP, defined benefit…

Q: Create investment portfolio (use a Philippine insurance and investment products)

A: In order to create an investment portfolio, the following steps should be considered: i) Asset…

Q: what us the 2021 general entry?

A: An employer agrees to provide employees with a predetermined amount of retirement benefits upon…

Q: Define the interest cost component of the periodic pension expense.

A: Pension: A fixed sum of money, receivable in future or after the age of retirement, which the…

Q: Given this is the situation, how should I be calculating the APR for each form of debt? It is…

A: Debt is something that one party borrows from another, usually money. Debt is used to make large…

Q: In computing the interest component of pension expense, what interest rates may be used?

A: Pension expense: Pension expense is an expense to the employer paid as compensation after the…

Q: Explain and analyze the effect of differences between IFRS and U.S. GAAP related to the financial…

A: In the United States, financial reporting practices are prescribed by Financial Accounting Standards…

Q: What is the revolving credit arrangements in the exposure draft, Topic 470?

A: The FASB issued an Exposure draft titled debt (470) which aims at simplifying the classification of…

Q: When would the cost of credit life insurance be included in the finance charge and APR calculations…

A: Introduction: The cost of a credit insurance premium depends on different aspects such as the size…

Q: ter the potential retirement income benefit. efined Contribution Pension Plan (DCPP) egistered…

A: Defined Pension Plan - An employer-promised defined/predetermined pension payment plan is referred…

Q: differentiate calculations BETWEEN leasing payment at END-OF-THE YEAR and BEGINNING OF THE YEAR?

A: The lease payment calculations are different for the beginning of the period and end of period…

Q: opinion: Should lease payments be a current liability included in the acid-test ratio? why

A: Acid-test ratio: The financial ratio which evaluates the ability of a company to pay off the instant…

Question

Provide explanationations on the gearing and interest coverage ratios by making comparison between 2021 and 2022

Return on Equity*
Return on Capital Employed*
Gross profit margin
Operating profit margin
Interest cover
Current ratio
Quick ratio
Inventories turnover period*
Settlement period for accounts
receivable*
Settlement period for accounts payable*
Operating cash cycle
Gearing
2022
16%
16.35%
37.3%
9.4%
2.9
0.69
0.03
72.1 days
1.4 days
97.2 days
?
51.5%
2021
29.4%
21.6%
38.7%
13.3%
6
0.71
0.09
62.9 days
1.5 days
89.3 days
?
54.9%

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

In determining the present value of the prospective benefits (often referred to as the defined benefit obligation), the following are considered by the actuary: retirement and mortality rate. interest rates. benefit provisions of the plan. d. all of these factors.
Illustration the mortgage for future advances?
What interest rates may be used to calculate the pension expense's interest component?
Why is it necessary for you to contribute to a pension? Why is there a need for persons to contribute more to the National Insurance Scheme? In your opinion, what are the important reasons for a country to increase the normal/minimum retirement age?
how do an annual bonus paid at year end be treated under IAS34 and how does this treatment differ from what is required under U.S GAAP?
How does IFRS differ from U.S. GAAP with respect to using the equity method?
Differentiate Simple and General Annuity; and briefly discuss the subtypes of each.
How will you relate and apply the derivatives instrument to an insurance policy?
In what ways are pension plans and other post-retirement benefit plans different, if at all?
could the amortization premium be put in a table form
What are liabilities that will be due within a short time (usually one year or less) and that are to be paid out of current assets called? Group of answer choices equity liabilities current liabilities fixed liabilities contra liabilities
How is the pension expense influenced by changes in the pension liability and plan assets?