Question: Question B2 Selected data for two similar shops in the garment industry are as follows. W-One Cash 85,000 Debtors 137,000 Stocks 450,000 Equipment (net) 485,000

Question B2 Selected data for two similar shops in the garment industry are as follows. W-One Cash 85,000 Debtors 137,000 Stocks 450,000 Equipment (net) 485,000 H-2000 250,000 212,000 460,000 627,000 Current liabilities Long-term liabilities Capital and retained earnings 250,000 400,000 507,000 320,000 500,000 729,000 Annual sales Cost of goods sold Salary Other expenses 1,000,000 300,000 150,000 250000 1,500,000 600,000 200,000 175,000 REQUIRED: 5/9 REQUIRED: a) Calculate each shop's net profit ratio, gross profit ratio, current ratio, quick ratio, retairn on assets, debtors ratio, stock turnover ratio, and gearing ratio. (14 marks) b) Which of the two shops, as judged by the preceding information, would you consider as being in a better financial position and why? (6 marks) (Total 20 marks)
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
