Answer the following question: B C ELEGANCE JEWELLERS INC STATEMENTS OF EARNINGS for years ending June 30

Answer the following question:

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B C ELEGANCE JEWELLERS INC STATEMENTS OF EARNINGS for years ending June 30 D E E F G H I J K L M N P 0 ELEGANCE JEWELLERS INC BALANCE SHEETS as at June 30 ELEGANCE JEWELLERS INC Ratio Analysis For the years ended June 20, 2021 and 2022 Ratios Analysis Comparision For the year ended 2022 Industry Averages Elegance (000s) 2022 2021 Assets (000s) 2022 2022 2021 2021 PROFITABILITY Age of receivables in days Current ratio (:1) 4.7 days 8.0 Sales Cost of sales 1,982.8 945.6 Gross income 1,037.2 1,721.5 774.0 947.5 Current assets: Vertical analysis Net worth to total assets 1.6 41% 5.1 32% Cash Operating Expenses: Selling and administrative 714.2 584.1 Depreciation 53.7 44.6 Accounts receivable Inventory Prepaid expenses Total current assets 1.3 43.2 1.2 Sales 100% 100% 9.2 Cost of goods sold 47.7% 45.0% 1,155.4 6.0 1,148.2 Gross income (profit) 52.3% 55.0% 5.3 Operating expenses: 38.7% 36.5% 1,205.9 1,163.9 General and administrative 36.0% 33.9% Total operating expenses 767.9 628.7 Depreciation 2.7% 2.6% Eamings from operations 269.3 318.8 Loans to employees Decrease Decimal 25.7 26.4 Income from operations 13.6% 18.5% bsidiary 686.2 Other income -0.6% Unusual income (loss) 11.70 -$ 10.50 Other investments 17.8 17.6 Interest expense 7.7% Subtotal 257.6 308.3 Income before tax 5.3% Less: interest expense 152.1 34.8 Fixed assets: Income after tax 4.0% -0.6% 2.0% 15.9% 11.9% Land 25.5 25.5 Return on average equity 11.0% Net eamings before tax 105.5 273.5 Buildings 441.1 374.0 Analysis As per the ratios, we confirmed that Elegance Jewelers Inc current performance co It has a lower profitability in 2022 compare to 2021. In comparison to the industry average, we see that Elegances net worth to total ass the industry proportion of net worth which suggests a higher level of debt. We see that the age of receivable in days is also higher in comparison to the indust The company has a slower collection process and is not receiving payments at the r Elegances assets and liabilities have also noticably gone up in comparision to 2021 The company has a strong financial position when it comes to current assets as we This means that the company is stable when it comes to meeting thier short-term c Income taxes 26.4 68.4 Furniture and fixtures 108.5 61.9 EFFICIENCY Net eamings after tax 79.1 205.1 Fixed assets, cost 575.1 461.4 Age of receivables in days 8.0 2.0 Less: accumulated depreciation 221.0 167.3 Age of inventory in days 446.0 541.5 Total fixed assets (net) 354.1 294.1 Age of payables in days Fixes asset tumover 85.7 72.1 6.1 Total Assets 2,289.7 1,502.0 LIQUIDITY Current ratio (:1) 5.1 1.8 LIABILITIES AND EQUITY Acid test (:1) 0.2 0.0 Working capital ($000) 969.3 517.5 Liabilities: Current liabilities: Working capital loan Accounts payable 10.4 223.7 133.0 STABILITY Income taxes payable 2.5 379.8 123.7 Net worth to total assets 0.3 0.5 Interest coverage (times) 1.7 8.9 Long-term debt due within one year 9.9 Debt to equity (:1) 2.1 1.1 Total current liabilities 236.6 646.4 GROWTH Bank loan (due December 31, 2023) 418.4 Sales Long-term notes payable 902.8 152.8 Net income Total liabilities 1,557.8 799.2 Assets 15.2% -61.4% 52.4% B C ELEGANCE JEWELLERS INC STATEMENTS OF EARNINGS for years ending June 30 D E E F G H I J K L M N P 0 ELEGANCE JEWELLERS INC BALANCE SHEETS as at June 30 ELEGANCE JEWELLERS INC Ratio Analysis For the years ended June 20, 2021 and 2022 Ratios Analysis Comparision For the year ended 2022 Industry Averages Elegance (000s) 2022 2021 Assets (000s) 2022 2022 2021 2021 PROFITABILITY Age of receivables in days Current ratio (:1) 4.7 days 8.0 Sales Cost of sales 1,982.8 945.6 Gross income 1,037.2 1,721.5 774.0 947.5 Current assets: Vertical analysis Net worth to total assets 1.6 41% 5.1 32% Cash Operating Expenses: Selling and administrative 714.2 584.1 Depreciation 53.7 44.6 Accounts receivable Inventory Prepaid expenses Total current assets 1.3 43.2 1.2 Sales 100% 100% 9.2 Cost of goods sold 47.7% 45.0% 1,155.4 6.0 1,148.2 Gross income (profit) 52.3% 55.0% 5.3 Operating expenses: 38.7% 36.5% 1,205.9 1,163.9 General and administrative 36.0% 33.9% Total operating expenses 767.9 628.7 Depreciation 2.7% 2.6% Eamings from operations 269.3 318.8 Loans to employees Decrease Decimal 25.7 26.4 Income from operations 13.6% 18.5% bsidiary 686.2 Other income -0.6% Unusual income (loss) 11.70 -$ 10.50 Other investments 17.8 17.6 Interest expense 7.7% Subtotal 257.6 308.3 Income before tax 5.3% Less: interest expense 152.1 34.8 Fixed assets: Income after tax 4.0% -0.6% 2.0% 15.9% 11.9% Land 25.5 25.5 Return on average equity 11.0% Net eamings before tax 105.5 273.5 Buildings 441.1 374.0 Analysis As per the ratios, we confirmed that Elegance Jewelers Inc current performance co It has a lower profitability in 2022 compare to 2021. In comparison to the industry average, we see that Elegances net worth to total ass the industry proportion of net worth which suggests a higher level of debt. We see that the age of receivable in days is also higher in comparison to the indust The company has a slower collection process and is not receiving payments at the r Elegances assets and liabilities have also noticably gone up in comparision to 2021 The company has a strong financial position when it comes to current assets as we This means that the company is stable when it comes to meeting thier short-term c Income taxes 26.4 68.4 Furniture and fixtures 108.5 61.9 EFFICIENCY Net eamings after tax 79.1 205.1 Fixed assets, cost 575.1 461.4 Age of receivables in days 8.0 2.0 Less: accumulated depreciation 221.0 167.3 Age of inventory in days 446.0 541.5 Total fixed assets (net) 354.1 294.1 Age of payables in days Fixes asset tumover 85.7 72.1 6.1 Total Assets 2,289.7 1,502.0 LIQUIDITY Current ratio (:1) 5.1 1.8 LIABILITIES AND EQUITY Acid test (:1) 0.2 0.0 Working capital ($000) 969.3 517.5 Liabilities: Current liabilities: Working capital loan Accounts payable 10.4 223.7 133.0 STABILITY Income taxes payable 2.5 379.8 123.7 Net worth to total assets 0.3 0.5 Interest coverage (times) 1.7 8.9 Long-term debt due within one year 9.9 Debt to equity (:1) 2.1 1.1 Total current liabilities 236.6 646.4 GROWTH Bank loan (due December 31, 2023) 418.4 Sales Long-term notes payable 902.8 152.8 Net income Total liabilities 1,557.8 799.2 Assets 15.2% -61.4% 52.4%