(a) Compute the following ratios based on the information given for Faber Trading: (i) Gross profit margin...
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Question:
(a) Compute the following ratios based on the information given for Faber Trading:
(i) Gross profit margin ratio (%)
(ii) Net profit margin ratio (%)
(iii) Current ratio (times)
(iv) Quick ratio (times)
(v) Average Stock Turnover Period (days)
(vi) Debtor Collection Period (days)
(b) Using the appropriate financial ratios calculated in (a), compare and comment on the performance and financial position of the two companies in terms of:
(i) Profitability
(ii) Liquidity (Solvency)
(iii) Efficiency of its inventory management.
Related Book For
Canadian Income Taxation planning and decision making
ISBN: 9781259094330
17th edition 2014-2015 version
Authors: Joan Kitunen, William Buckwold
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