Statement of Profit and Loss and Other Comprehensive Income for the yearsended 31 December20242023R'000R'000Turnover1287052 934052Operating Profit13734281768Net Finance Cost3926420862Operating Profit before taxation9807860906Income tax expense70273048Profit for the Year910515785835022237Operating profit includes Depreciationand loss on sale of fixed asset5/12Required:a) Prepare the cash flows from operating activities for the company for 2024using the available information(10 Marks)b) Perform a financial review of the company based on calculating the followingfinancial ratios and explain how it may be interpreted.Debt equity ratioTimes interest earnedCurrent ratioDebtors average collection periodInventory turnoverYour answer should include an overall assessment of the company (25 Marks)c) List the audit steps to verify the existence of inventory(10 Marks)

a) Prepare the cash flows from operating activities for the company for 2024 using the available…

Answered: Statement of Profit and Loss and Other…

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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Fixed Asset Turnover Ratio Financial statement data for years ending December 31 for Dennis Company follow: Year 2 Year 1 Sales $4,521,000 $3,960,000 Fixed assets: Beginning of year 1,140,000 1,060,000 End of year 1,600,000 1,140,000 a. Determine the fixed asset turnover ratio for Year 1 and Year 2. Round your answers to one decimal place. Fixed asset turnover Year 1 Year 2 b. Does the change in the fixed asset turnover ratio from Year1 to Year 2 indicate a favorable or an unfavorable change? Unfavorable V
DEVCON INDUSTRIES LIMITED Income Statement For the years ended Dec. 31, 2018 and 2019 2018 2019 so00's s000's Sales 900000 1125000 Cost of Goods Sold 300000 306600 Gross Profit 600000 818400 Selling and Administrative Expenses 150000 156000 Depreciation Expense 54000 57000 Advertising Expenses 18000 21000 Earnings Before Interest and Taxes 378000 584400 Interest Expense 3000 3000 Taxable Income 375000 581400 Taxation (35%) 131250 203490 Net Income 243750 377910 Dividends (40%) 97500 151164 Addition to Retained Earnings 146250 226746 Additional Information Share Price 21 27.3 Ordinary Shares Outstanding 120000000 144000000 DEVCON INDUSTRIES LIMITED Statement of Financial Position As at Dec. 31, 2018 and 2019 ASSETS 2018 2019 LIABILITIES & EQUITY 2018 2019 Current Assets s00's s000's Current Liabilities so00's So00's Inventories 264000 276000 Accounts Payables Notes Payables 138000 114000 Accounts Receivables 294000 330000 150900 132654 Cash and Equivalents 210900 270000 288900 246654…
The income statement disclosed the following items for the year: Depreciation expense $40,700 Gain on disposal of equipment 23,760 Net income 254,700 The changes in the current asset and liability accounts for the year are as follows: Increase (Decrease) Accounts receivable $6,340 Inventory (3,610) Prepaid insurance (1,350) Accounts payable (4,300) Income taxes payable 1,350 Dividends payable 950 a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from (used for) operating activities: Adjustments to reconcile net income to net cash flows from (used for) operating activities: Changes in current operating assets and liabilities: Net cash flows from operating activities b. Why is net cash flows from operating activities different than net income? Cash flows…
The income statement disclosed the following items for the year: Depreciation expense $57,400 Gain on disposal of equipment 33,510 Net income 494,300 The changes in the current asset and liability accounts for the year are as follows: Increase(Decrease) Accounts receivable $8,950 Inventory (5,090) Prepaid insurance (1,910) Accounts payable (6,070) Income taxes payable 1,910 Dividends payable 1,340 a. Prepare the “Cash flows from operating activities” section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.
The following is the trial balance relates to the business of Sam a sole trader as at31 December 2021: Sam Trial Balance as at 31 December 2021 Land and Buildings Motor Vehicles Depreciation of motor vehicles Sales Sales return Capital Machinery Carriage inwards Depreciation of Machinery Purchases Purchases Returns Inventory 1 January 2021 Selling Expenses Wages and salaries Miscellaneous expenses Loan from NCB Receivables and Payables Bank Account Rent Received DR Drawings $ Administration expenses 150,000 700,000 400,000 15,000 750,000 6,000 950,000 165,000 260,000 78,000 56,000 246,000 120,000 370,000 4,266,000 CR $ 60,000 3,100,000 600,000 70,000 20,000 230,000 160,000 26,000 4,266,000
Asset turnover ratio Financial statement data for years ended December 31, 20Y3 and 20Y2, for Edison Company follow: 20Y3 20Y2 Sales $1,950,000 $1,564,000 Total assets: Beginning of year 740,000 620,000 End of year 820,000 740,000 a. Determine the asset turnover ratio for 20Y3 and 20Y2. Round answers to one decimal place. 20Y3 20Y2 Asset turnover fill in the blank 1 fill in the blank 2 b. Is the change in the asset turnover ratio from 20Y2 to 20Y3 favorable or unfavorable?
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Fixed Asset Turnover Ratio Financial statement data for years ending December 31 for Dennis Company follow: Year 2 Year 1 Sales $4,521,000 $3,960,000 Fixed assets: Beginning of year 1,140,000 1,060,000 End of year 1,600,000 1,140,000 a, Determine the fixed asset turnover ratio for Year 1 and Year 2. Round your answers to one decimal place. Fixed asset turnover Year 1 Year 2 b. Does the change in the fixed asset turnover ratio from Year 1 to Year 2 indicate a favorable or an unfavorable change? Check My Work Save an 31 tv MacBook Air DII DD F7 F2 F3 F4 F5 F6 F8 F9 F10 #3 2$ 3 8. W R Y U < cO
The year-end financial statements for North Railway report the following information: 0.46 0.41 1.74 (In millions) 0.25 Revenues Year ended December 31, Property and equipment, net Total assets Year 2 Year 1 The annual property, plant, and equipment turnover (PPET) is: $15,095 $21,967 61,250 59,510 84,122 81,703
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The following information is from Lacy's Inc. $ millions Prior Fiscal Year Current Fiscal Year Net Year-End Assets Revenue Income $21,330 14,403 $18,955 $1,070 a. Compute the asset turnover ratio for the current fiscal year. b. Compute the return on assets ratio for the current fiscal year. Numerator a. Asset Turnover Ratio $ Check b. Return on Assets Ratio $ Numerator Denominator / $ Denominator / $ || Result Result
Gross Profit from Operations Tax Exempt Interest Capital gains Capital Loss carryforward Compensation expense Depreciation: Tax=$8,000/ E&P=$6,500 Other expenses Total Expense Book/ Taxable Income (1) Federal Income Tax (21%) Book Income $100,000 10,000 5,000 0 Total Income $115,000 $-12,000 30,000 6,000 10,000 46,000 (2) 69,000 M-1s 0 -10,000 0 -2000 0 2,000 0 2,000 -14,000 (3) Tax Income $100,000 0 5000 -2000 $103,000 30,000 8,000 10,000 48,000 55,000 0 After making your adjustments, what is ABC Corporation's current year E&P? (4) E&P Adjustment 0 0 n/a 0 0 n/a n/a

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