Acoms is a small busi9ness with limited liability. Its financial results are given below: Financial Statement Analysis
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Question:
Acoms is a small busi9ness with limited liability. Its financial results are given below:
Financial Statement Analysis
Additional Information
The follwing are ratios for acoms for the year 31 May 2010 and the industry average ratios for 2011:
Required:
(a) Calculate the following ratios for Acoms for the year ended 31 May 2011. State clearly the formula used for each ratio.
(i) Gross profit percentage.
(ii) Net profit percentage
(iii) Current ratio
(iv) Acid test (Quick) ratio
(v) Receiveables collection period (10 Marks)
(b) Use the information given and the ratios you calculated in part (a) to comment on the performance of Acoms. (14 marks)
(c) State three limitations of ratio analysis (6 marks)
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