Using two measures of liquidity (current ratio and quick or acid test ratio), discuss whether there were significant differences in performance between the two companies and whether there were warning signs of JBB Sports' potential failure Balance Sheetas atNon-current assetsIntangible assetsProperty, plant and equipmentInvestments in associated undertakings & jointventuresOther assetsTotal non-current assetsCurrent assetsInventoriesTrade receivablesOther receivablesCash and cash equivalentsTotal current assetsTotal assetsCurrent liabilitiesBorrowingsTrade payablesOther payablesTotal current liabilitiesNon-current liabilitiesBorrowingsOther payablesTotal non-current liabilitiesTotal liabilitiesNet assetsCapital and reservesShare capitalShare premium accountOther reservesRetained earningsTotal equityAverage number of employeesJJB Sports JJB Sports Sports DirectpleplePLCPLC29-Jan-1230-Jan-11 20-Apr-12 24-Apr-11£'000£'000£'000£'00024,20146,09170,29247,3029836,8094,63859.732130,02433,97164,85934,824258,2211,86098,83052,7254488,6295,859(263,931)30.9745,108(-)(9,303)(17,712) (38,471) (155,468)(35,423) (36,662)(172,940)(53,135) (75,133)(337,711)225,150313,02367,661485,277166,491 1,132,179(99,050) (122,420) (660,294)(30,974) (44,071)(471,885)29,47079,259646,90232,542174,055276316,80044,12239,75584,600(162,802)44,0716,701(15,915)(24,678) (214,587) (196,182)(30,000) (22,609)(107,996)(102,701)(45.915) (47.287) (322,583)(298,883)(585,055)(331,135)SportsDirect600,431471,885205,050236,09712,14538,34766,540546,034217,93847,59444,11160,513370,156916,190(13,219)(95,700)(177,253)(286,172)64,060874,300(1,066,906) (1,048,151)440,931331,13564,055874,30010,312 3. The DataConsolidated Income StatementFor period endedRevenueCost of salesGross profitSelling, distribution & administrativeexpensesOther operating incomeOperating profit (loss)Investment income (costs)Finance incomeFinance costsFinancial instrument adjustment & issuecostsShare of profit (loss) of associatedundertakings & joint venturesProfit (loss) before taxJJB Sports JJB Sports Sports Direct Sports DirectpleplePLC29-Jan-12£'00024-Apr-11£'000284,206(182,722)101,484(566)PLC30-Jan-11 20-Apr-12£'000£'000(160,408) (200,578) (596,383)2,6821,8485,283153,176(56,242) (73,856)113512(5,800)6,426(8,481)2,774362,8941,835,756(238,020) (1,091,480)124,874744,276(1,162)1,097558(53,921) (73,409) 145,8791,599,237(940,330)658,907(527,273)5,289136,923(9,481)2,560(8,953)121,041

Current Ratio:The current ratio is a financial metric used to assess a company's short-term…

Using two measures of liquidity (current ratio and quick or acid test ratio), discuss whether there were significant differences in performance between the two companies and whether there were warning signs of JBB Sports' potential failure

Using two measures of liquidity (current ratio and quick or acid test ratio), discuss whether there were significant differences in performance between the two companies and whether there were warning signs of JBB Sports' potential failure

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Earnings are considered to be of lower quality if O cash flow from operating activities is greater than net earnings. O cash flow from financing activities is less than net earnings. O cash flow from operating activities is less than net earnings. O cash flow from investing activities is less than net earnings.
Which of the following best describes what we mean when we refer to the quality of financial statements? O A. Showing only revenue from product sells. B. Presenting all relevant information in a fair and complete manner. O C. Listing all assets in alphabetical order. OD. All of the above.
Only answer fill in the blanks.
See Image for Information Compute the following performance indices for both companies: Profit margin Asset turnover Return on Capital Employed (ROCE) Current ratio Debt equity ratio Compare and analyse the performance of the two companies computed in (1) above and explain what the board of Box Limited needs to do to achieve their objective . c. Which other non-financial measures can influence the decision of the board of Box Limited?
at the bottom. Had there been a loss for the In reviewing the income statement of a profitable company, one can see that it begins with at the top and ends with year, the final result would have been a What exactly does the word balance mean in the title of the balance sheet? Why do we balance the two halves? (Select all the answers that apply.) A. The balance sheet balances the firm's assets against its financing, which can be either debt or equity. B. The total value of all of the firm's assets should equal the sum of its short- and long-term debt plus stockholder's equity. C. In order for the balance sheet to balance, stockholder's equity must exclude preferred stock, common stock at par value, paid in capital in excess of par on common stock and retained earnings from previous profitable years in which some of the earnings were held back and not paid out as dividends. D. When the balance sheet does not balance, the difference must be reported as an "off-balance sheet" account for…
Which of the following is not one of the typical uses of financial ratios? a. Comparisons to a company’s historic values b. Comparison to benchmarksc. Comparison to competitors’ values d. Comparison to zero with positive values indicating desirable ratios and negative values indicating undesirable ratios.
Suppose you a stock analyst are performing a ratio analysis and comparing a discount merchdiser with a high end merchandiser. Suppose further that both companies have identical ROE. IF You apply the dupont equation to both firms, would you expect the three components to be the same for both companies? If not, explain what balance balance sheet and income statements might lead to the differences in the Dupont equation components.
Hi please assist
81) Inadequacies of the existing system of financial ratios signify a need for a different approach to monitoring business performance. Of the following statements, which is NOT a shortcoming of financial ratios? a) financial measures are lagging indicators of business performance. b) financial ratios have a short-term orientation and emphasize the cash flow rather than the processes that contribute to cash flow. c) Financial ratios focus equally on the stockholders as on the customers, suppliers and employees. d) A and B e) A and B and C
The primary purpose of showing special types of eventsseparately in the income statement is to:a. Increase earnings per share.b. Assist users of the income statement in evaluating theprofitability of normal, ongoing operations. c. Minimize the income taxes paid on the results of ongo-ing operations. d. Prevent unusual losses from recurring.
Which of the following statements regarding the consistency concept is not true? Select one: A. The objective of the consistency concept is to facilitate comparison between one period and another B. A selected accounting method must be used consistently every year C. A company cannot change the selected accounting method once it is used D. If inconsistency is found, the company must provide full explanation in the Statement of Profit or Loss and Other Comprehensive Income itself, or in the Statement of Financial Position, or in the notes to the accounts
7,8,9,10