The following information relates to Arte’s Gallery. The owner, P Arte, is concerned about the profitability and liquidity of the business.

ARTE’S GALLERY

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2012

Capital P. Arte 1 July 2011 ............................$192 900

Less Loss ...........................................................84 300

                                                                             108 600

Less Drawings             ...................................................4,000

Capital P Arte 30 June 2012.........................$104 600

Additional Information:

All Sales were on credit.

Required:

Calculate the following ratios for 2011 and 2012. Show all calculations. (Where an average figure is not available, add this as a comment.)

• Profit Margin
• Gross Profit margin
• Current Ratio
• Quick Ratio
• Receivables Turnover
• Average Collection Period
• Inventory Turnover

Transcribed Image Text:

ARTE'S GALLERY BALANCE SHEET ASAT 30 JUNE 2012 30 JUNE 2011 ASSETS Current Cash and Cash equivalents Accounts Receivable Inventory Prepaid insurance Accrued sales revenue $37 000 18 200 S19 600 50000 600 1 500 nil nil $71 700 Non-Current Office Equipment Shop Shelving Less Acc Dep Shop Shelving 1 000 S79 000 11 000 68 000 75 000 69 000 TOTALASSETS 140 700 Less LIABILITIES Current Bank Overdraft Accounts Payable Accrued Expenses 9 000 26 600 500 nil 17 550 nil 36 100 NET ASSETS EQUITY Capital P Arte $104600