Q.1 Set. (B) ARVIND FASHIONS LTD Profit and Loss Account (Amount in Rs. Crores) Particulars Sales...

 

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Q.1 Set. (B) ARVIND FASHIONS LTD Profit and Loss Account (Amount in Rs. Crores) Particulars Sales Expenses Operating Profit Other Income The following are the financial statements for Arvind Fashion Ltd. for last two years. Depreciation Interest Profit before tax Tax Net profit 2019 4644 4350 294 4 153 131 13 -9 17 2020 3614 3390 224 -2 421 278 -477 0 -477 Balance Sheet (Amount in Rs. Crores) Particulars Equity Share Capital Reserves Borrowings Other Liabilities (CL) Total Net Block Capital Work in Progress Investments Other Assets (CA) Total 2019 23 1106 824 1571 3524 537 11 0 2975 3524 2020 23 574 2162 1673 4433 1234 1 0 3197 4433 You are required to (a) Calculate and interpret: liquidity ratio (current ratio, quick ratio) and solvency ratio (debt-equity ratio, debt-to-total capital employed ratio, interest coverage ratio). [5 Marks] (b) Calculate and interpret: turnover ratio (inventory turnover, debtors' turnover, total assets turnover ratio) and profitability ratio (ROI and ROE). [5 Marks] Q.1 Set. (B) ARVIND FASHIONS LTD Profit and Loss Account (Amount in Rs. Crores) Particulars Sales Expenses Operating Profit Other Income The following are the financial statements for Arvind Fashion Ltd. for last two years. Depreciation Interest Profit before tax Tax Net profit 2019 4644 4350 294 4 153 131 13 -9 17 2020 3614 3390 224 -2 421 278 -477 0 -477 Balance Sheet (Amount in Rs. Crores) Particulars Equity Share Capital Reserves Borrowings Other Liabilities (CL) Total Net Block Capital Work in Progress Investments Other Assets (CA) Total 2019 23 1106 824 1571 3524 537 11 0 2975 3524 2020 23 574 2162 1673 4433 1234 1 0 3197 4433 You are required to (a) Calculate and interpret: liquidity ratio (current ratio, quick ratio) and solvency ratio (debt-equity ratio, debt-to-total capital employed ratio, interest coverage ratio). [5 Marks] (b) Calculate and interpret: turnover ratio (inventory turnover, debtors' turnover, total assets turnover ratio) and profitability ratio (ROI and ROE). [5 Marks]

Answer rating: 100% (QA)

a Liquidity Ratio and Solvency Ratio Current Ratio Current Ratio Current Assets Current Liabilities For 2019 Current Ratio 2975 1571 189 For 2020 Current Ratio 3197 1673 191 Interpretation The current ... View the full answer