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wha is asset turnover- performance ratiosasset turnover turnover total assets or capital employedthis demonstrates how much sales are generated for
determine the name of some profit margin ratiosother profit margin ratios can also be computed gross profit turnover profit after tax turnover
operating profit marginoperating profit margin pbit turnover x 100this is the ratio of operating profit to turnover or sales a
what is performance ratiosrocereturn oncapital employed roce profit before interest and tax pbit capital employed 100roce measures profitability
exam technique for analysing performancethe below steps must be adopted when answering a question on analysing performancestep 1 review
in how many area ratios are groupedratios can be grouped into 3 main areas1 performance - how well business has done profitability2 position - short
what is the ratio usesto compare results over a period of timeto measure performance against other organisationsto compare results with a targetto
determine the types of usersinvestors -look at the risk of their investment future growth and profitabilitymanagers employees-have access to more
analysing performance through ratiosratios are an effective way of analysing financial statements a ratio is 2 figures compared to each other and can
financial analysisthe purpose of financial statements is to provide information to all the users of these accounts to assist them in their
q working capital mini qsduring january 20x4 gazza ltd made credit sales of pound30000 that have a 25 mark up it also purchased pound20000 of
q example on controlling working capitaldescribe how a manufacturing company could control its working capital levels and impact of the suggested
the following are extracts of the income statement and balance sheet for umar plcextract balance sheet at 30 june20x2
if current ratio for a company is equal to its acid test that is quick ratio thena the current ratio must be less than oneb working capital is
a companys current assets are less than its current liabilities company issues new shares at full market pricewhat will be the effect of this
q calculate drs quick ratiodr has the following balances under current assets and current liabilitiescurrent assetscurrent
an entitys working capital financing policy is to finance working capital using short-termfinancing to fund all the fluctuating current assets as
q conservative policy for financing working capitala conservative policy for financing working capital is one where short-term finance is usedto
q calculate ads working capital cyclead a manufacturing entity has the following balances at 30 april 2005extract from financial statements
inventory turnover is the reciprocal of inventory dayscost of salesaverage inventoryx number of timesthis shows how quickly inventory is being sold
average inventorycost of sales 365 daysaverage inventory can be arrived by taking this years and last years inventory values and dividing by 2-
q what are trade receivable daysyear-end trade receivablescredit sales or turnover 365 daysthis is average length of time taken by customers to pay
q what do you meant by trade payable daysyear-end trade payablescredit purchases or cost of salesx 365 daysthis is the length of time taken to pay
q show the quick ratio or acid testquick ratio current assets less inventoriescurrent liabilities timesthis ratio measures immediate solvency of a
current ratio ca or working capital ratioca current assetscurrent liabilities timescurrent ratio measures the short term solvency or liquidity it