3.1
Profit margin = Profit after tax / sales
Profit margin = 180,000/1,288,000
Profit margin = 13.98%
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3.2
Interest cover = EBIT / Interest
Interest cover = 278,000 / 70,000
Interest cover = 3.97 times
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3.3
Debtor collection period = (Accounts receivable*365)/Credit
sales
Debtors collection period = (300,000*365)/1,288,000
Debtor collection period= 85.02 days
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3.4
Current ratio = current asset / current liabilities
Current ratio = (266,000+300000+220,000)/215,000
Current ratio = 786,000/215,000
Current ratio = 3.66
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3.5
Acid test ratio= (Debtors+cash) / current liabilities
Acid test ratio = (300000+220,000)/215,000
Acid test ratio = 520,000/215,000
Acid test ratio = 2.42
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3.6
Return on own capital =profit after tax / Own capital
Return on own capital = 180,000/(1,000,000+482,000)
Return on own capital = 12.15%
