Question 2 (60 marks) Spring Limited and Autumn Limited are in the same line of business....

 

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Question 2 (60 marks) Spring Limited and Autumn Limited are in the same line of business. Their accounts for the year ended December 31, 2021 were as follows. Sales Less: Cost Of Sales Opening Stock. Add: Purchases Profit And Loss Account For the year ended December 31, 2021 Spring Limited (S) Less: Closing Stock Cost Of Sales Gross Profit Less: Operating Expenses. Net Profit Fixed Assets Fixed Assets At Cost Less: Accumulated Depreciation Current Assets Stock Debtors Cash And Bank Less: Current Liabilities Creditors Working Capital 18,900 187,350 206,250 (56,700) Balance Sheet As at December 31, 2021 141,750 (28,350) Spring Limited (S) ($) 56,700 59,600 ($) 303,750 28,300 144,600 149,550 154,200 79,200 75,000 (58,000) 113,400 86,600 200,000 Autumn Limited (S) ($) 232,500 6,650 68,750 75,400 (15,000) Autumn Limited (S) ($) 122,500 (21,900) 15,000 118,100 8,800 141,900 60,400 172,100 52,100 120,000 (22,500) 100,600 119,400 220,000 Financed By: Shareholders' Equity Share Capital Retained Earnings - Opening Add: Net Profit For The Year Long-Term Liabilities 20% Bank Loan (b) (iii) (iv) Balance Sheet As at December 31, 2021 (v) (vi) (vii) (viii) (ix) (x) Spring Limited (5) (S) 30,000 15,000 75,000 Required: (a) Compute the following ratios of these two companies (1) Gross profit percentage Net profit percentage 120,000 80.000 200,000 Autumn Limited (5) (S) Total for this assignment is 100 marks. 45,000 25,000 120,000 *** END Of The Paper *** 190,000 Return on capital employed whereas using closing balance as capital base Debtors collection period (months) Creditors payment period (months) Current ratio Acid test ratio Stock turnover rate Debts assets ratio 30,000 220.000 Gearing ratio (30 marks) Comment on your findings by comparing the profitability and financial position of these two companies. (30 marks) Question 2 (60 marks) Spring Limited and Autumn Limited are in the same line of business. Their accounts for the year ended December 31, 2021 were as follows. Sales Less: Cost Of Sales Opening Stock. Add: Purchases Profit And Loss Account For the year ended December 31, 2021 Spring Limited (S) Less: Closing Stock Cost Of Sales Gross Profit Less: Operating Expenses. Net Profit Fixed Assets Fixed Assets At Cost Less: Accumulated Depreciation Current Assets Stock Debtors Cash And Bank Less: Current Liabilities Creditors Working Capital 18,900 187,350 206,250 (56,700) Balance Sheet As at December 31, 2021 141,750 (28,350) Spring Limited (S) ($) 56,700 59,600 ($) 303,750 28,300 144,600 149,550 154,200 79,200 75,000 (58,000) 113,400 86,600 200,000 Autumn Limited (S) ($) 232,500 6,650 68,750 75,400 (15,000) Autumn Limited (S) ($) 122,500 (21,900) 15,000 118,100 8,800 141,900 60,400 172,100 52,100 120,000 (22,500) 100,600 119,400 220,000 Financed By: Shareholders' Equity Share Capital Retained Earnings - Opening Add: Net Profit For The Year Long-Term Liabilities 20% Bank Loan (b) (iii) (iv) Balance Sheet As at December 31, 2021 (v) (vi) (vii) (viii) (ix) (x) Spring Limited (5) (S) 30,000 15,000 75,000 Required: (a) Compute the following ratios of these two companies (1) Gross profit percentage Net profit percentage 120,000 80.000 200,000 Autumn Limited (5) (S) Total for this assignment is 100 marks. 45,000 25,000 120,000 *** END Of The Paper *** 190,000 Return on capital employed whereas using closing balance as capital base Debtors collection period (months) Creditors payment period (months) Current ratio Acid test ratio Stock turnover rate Debts assets ratio 30,000 220.000 Gearing ratio (30 marks) Comment on your findings by comparing the profitability and financial position of these two companies. (30 marks)