How to calculate the ratio with my answers in the balance sheet, income statement Current ratio Quick
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Question:
- How to calculate the ratio with my answers in the balance sheet, income statement
- Current ratio
- Quick ratio
- Gross prot ratio
- Net prot rate
- Inventory turnover (assume when calculating average inventory, the Opening Inventory = $0)
- Days inventory is held
- Make three suggested changes the partners could make that would help business growth. For each, describe how it will benet the business in the longer term.
- Explain the advantages and disadvantages of the ratio analysis you have completed
- Comment on how the liquidity, protability and activity of the business compares with the following industry averages:
Income statement | Balance sheet | ||||||||
3 months ended 30 June 2022 | as at 30 June 2022 | ||||||||
$ | $ | $ | $ | $ | $ | ||||
Sales | 35,680.00 | Current Assets | |||||||
Opening Inventory | Cash | 39,681.10 | |||||||
Purchases | 22,160.00 | Inventory | 9,334.00 | ||||||
Packaging | 754.00 | Prepaid Insurance | 1,125.00 | ||||||
Cost of Goods Available for Sale | 22,914.00 | Total Current Assets | 50,140.10 | ||||||
Less: Ending Inventory | - 9,334.00 | 13,580.00 | Non Current Assets | ||||||
Gross Profit | 22,100.00 | Equipment | 5,000.00 | ||||||
Less: Operating Expenses | Equipment - Accum Depreciation | -250.00 | 4,750.00 | ||||||
Marking and Distribution | Furniture | 800.00 | |||||||
Adversting | 480.00 | Furniture - Accum Depreciation | -20.00 | 780.00 | |||||
Delivery Costs | 502.00 | 982.00 | Software | 1,800.00 | |||||
Administration | Software - Accum Depreciation | -90.00 | 1,710.00 | ||||||
Accounting Fees | 542.00 | Total Non-Current Assets | 7,240.00 | ||||||
Depreciation | 360.00 | Total Assets | 57,380.10 | ||||||
Insurance | 375.00 | Current Liabilities | |||||||
Order Costs | 714.00 | GST Collected | 3,568.00 | ||||||
Rent | 1,200.00 | Less GST Paid | -3,187.90 | 380.10 | |||||
Telephone and Interent | 420.00 | Total Liabilities | 380.10 | ||||||
Website Maintenance | 1,007.00 | 4,618.00 | Net Assets | 57,000.00 | |||||
Total Expenses | 5,600.00 | Owner's Equity | |||||||
Net Profit | 16,500.00 | James, Capital | 15,000.00 | ||||||
To James | 5,500.00 | James, Current | 4,000.00 | 19,000.00 | |||||
To Leona | 5,500.00 | Leona, Capital | 15,000.00 | ||||||
To Brady | 5,500.00 | Leona, Current | 4,000.00 | 19,000.00 | |||||
Brady, Capital | 15,000.00 | ||||||||
Brady, Current | 4,000.00 | 19,000.00 | |||||||
57,000.00 | |||||||||
Cash flow statement | |||||||||
3 months ended 30 June 2022 | |||||||||
$ | |||||||||
Cash flows from operating activities | |||||||||
Receipts from customers (including GST) | 39,248.00 | ||||||||
Payments for inventory (including GST) | -25,205.40 | ||||||||
Expenses paid (including GST) | -7,001.50 | ||||||||
GST paid on purchases of non-current assets | -260.00 | ||||||||
Net cash from operating activities | 6,781.10 | ||||||||
Cash flows from investing activities | |||||||||
Payments for furniture | -800.00 | ||||||||
Payments for software | -1,800.00 | ||||||||
Net cash from investing activities | -2,600.00 | ||||||||
Cash flows from financing activities | |||||||||
Capital invested by partners | 40,000.00 | ||||||||
Payments for drawings | -4,500.00 | ||||||||
Net cash from financing activities | 35,500.00 | ||||||||
Change in cash balance | 39,681.10 | ||||||||
Add: Cash at the start of the period | 0 | ||||||||
Cash at the end of the period | 39,681.10 | ||||||||
Related Book For
Horngrens Financial and Managerial Accounting
ISBN: 978-0133866292
5th edition
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura
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