Comparative figures from the statement of financial position for Border Ltd are shown below.

Required

Prepare common size statements for the company for both years, and comment on what this analysis reveals about Border’s financing policy.

Transcribed Image Text:

Current assets Cash at bank Accounts receivable Inventory Non-current assets Term deposit Plant and equipment (net) Total assets Current liabilities 2020 2019 52000 84000 $ 30000 $ 25.000 54 000 86000 166000 165 000 50000 40000 180000 160000 230000 200000 396 000 365000 Accounts payable 48000 52000 Mortgage 20000 20000 68000 72000 Non-current liabilities Mortgage 120000 100000 120000 100 000 Total liabilities Net assets Equity 188000 172000 $208,000 $193000 Share capital 100000 100000 Retained earnings 108000 93 000 $208000 $193000