Extracts from the financial statements of Apillon for the year ended 31 March 2011 and 2012 are

Question:

Extracts from the financial statements of Apillon for the year ended 31 March 2011 and 2012 are given.

Note a: sales revenue includes a cash sale of £300,000 in 2011 and £100,000 in 2012.

Required:

(a) Calculate the following for each year:

(i) Current ratio

(ii) Quick ratio (acid test)

(iii) Inventory turnover ratio

(iv) Trade receivable days

(v) Trade payable days.

(b) Make four brief comments on the changes in the position of the company as revealed by changes in these ratios and/or in the amounts stated in the financial statements.

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Financial Accounting An Introduction

ISBN: 9780273737650

2nd Edition

Authors: Mr Barry Elliott, Mr Augustine Benedict

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Question Posted: Aug 28, 2023 09:25 AM

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Extracts from the financial statements of Apillon for the year ended 31 March 2011 and 2012 are

Question:

Statement of income year ended 31 March 2011 Sales revenue (note a) Opening inventory Purchases Closing inventory Gross profit Expenses Net profit £'000 360 2,080 (540) £'000 3,100 (1,900) 1,200 (900) 300 2012 £'000 £'000 3,800 540 2,580 (720) (2,400) 1,400 (1,100) 300

Step by Step Answer:

a b Comments i Lower current ratio 20 may indicate liqui...View the full answer

Financial Accounting An Introduction

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