JRP Ltd is a mail-order business selling a variety of consumer products. At the end of 2015,

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JRP Ltd is a mail-order business selling a variety of consumer products. At the end of 2015, its major shareholder instigated changes in management in order to improve performance. The financial statements for the years ending 30 June 2015 and 2016 are shown below.

INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2016 $000 Sales Less: COGS Gross profit Less: Expenses: Selling

BALANCE SHEET AS AT 30 JUNE Current assets Inventory Accounts receivable Total current assets Noncurrent

1. Calculate the following ratios:

a. Return on assets (using EBIT)

b. Asset turnover

c. Profit margin

d. Return on shareholders' equity

e. Current

f. Quick asset

g. Inventory turnover

h. Days in inventory

i. Debtors turnover

j. Days in debtors 

k. Debt-to-equity

I. Interest coverage.
2. Comment on the company's performance, indicating any changes you would suggest.

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Financial Accounting An Integrated Approach

ISBN: 9780170349680

6th Edition

Authors: Ken Trotman, Michael Gibbins, Elizabeth Carson

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