a) You need to assess the validity of this proposition by calculating the following financial ratios: i)
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Question:
a) You need to assess the validity of this proposition by calculating the following financial ratios:
i) Gross profit margin
ii) Operating profit margin
iii) Return of capital employed
iv) Current ratio
v) Acid test ratio
vi) Trade receivable days
vii) Trade payable days
viii) Inventory days (16 marks)
b) Interpret the ratios computed for 2021 and 2022. Further, and using the above computed ratios, advise Gower Plc whether it could grant the request made by the managing director of Ager Ltd.
Related Book For
Accounting What the Numbers Mean
ISBN: 978-1260565492
12th edition
Authors: David Marshall, Wayne McManus, Daniel Viele
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