SN Ltd is a median private company located in the North West of Kenya. It was...

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SN Ltd is a median private company located in the North West of Kenya. It was formed some twenty years ago. The company is wholesale company with the main objective of buying and selling Moran novelty products for supply to various holiday resorts in the coastal region. The company has five directors and there are about 100 shareholders, including all the directors. Since its formation, the company has always been reasonably profitable and until recently they have been few problems. P Given below are the latest financial statements: TRADING AND PROFIT AND LOSS ACCOUNT For the year ended 31st March 2011 To Opening Stock To Purchases To Gross Profit To Sundry Expenses To Net Profit Amt 580,000 By Sales 2,440,000 By Closing Stock 600,000 3,620,000 320,000 By Gross Profit 280,000 600,000 Amt 3,000,000 620,000 3,620,000 600,000 600,000 BALANCE SHEET For the year ended 31st March 2011 Amt Assets Liabilities Share Capital Reserves & Surplus Bal. Profit for the Year Bank Overdraft Creditors 200,000 280,000 2,800,000 a) Current Ratio b) Liquid Ratio c) Stock-Turnover Ratio Net Block Current Assets: Stock 480,000 Debtors 140,000 Cash 600,000 4,020,000 d) Operating Ratio e) Return on Net Capital Employed Amt 2,200,000 620,000 320,000 880,000 You are required to calculate the following ratios and state the purpose they serve. 4,020,000 SN Ltd is a median private company located in the North West of Kenya. It was formed some twenty years ago. The company is wholesale company with the main objective of buying and selling Moran novelty products for supply to various holiday resorts in the coastal region. The company has five directors and there are about 100 shareholders, including all the directors. Since its formation, the company has always been reasonably profitable and until recently they have been few problems. P Given below are the latest financial statements: TRADING AND PROFIT AND LOSS ACCOUNT For the year ended 31st March 2011 To Opening Stock To Purchases To Gross Profit To Sundry Expenses To Net Profit Amt 580,000 By Sales 2,440,000 By Closing Stock 600,000 3,620,000 320,000 By Gross Profit 280,000 600,000 Amt 3,000,000 620,000 3,620,000 600,000 600,000 BALANCE SHEET For the year ended 31st March 2011 Amt Assets Liabilities Share Capital Reserves & Surplus Bal. Profit for the Year Bank Overdraft Creditors 200,000 280,000 2,800,000 a) Current Ratio b) Liquid Ratio c) Stock-Turnover Ratio Net Block Current Assets: Stock 480,000 Debtors 140,000 Cash 600,000 4,020,000 d) Operating Ratio e) Return on Net Capital Employed Amt 2,200,000 620,000 320,000 880,000 You are required to calculate the following ratios and state the purpose they serve. 4,020,000

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