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  3. required: a) calculate each companys net profit ra

REQUIRED: a) Calculate each companys net profit ratio, current ratio, quick ratio, return on...

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Accounting

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REQUIRED:

a) Calculate each companys net profit ratio, current ratio, quick ratio, return on assets, debtors ratio, stock turnover ratio, and gearing ratio.

b) Which of the two companies, as judged by the preceding information, would you consider as being in a better financial position and why?

Question 2 Selected data for two similar companies in the toy industry are as follows. -One -Q Cash 85,000 250,000 Debtors 212,000 137,000 460,000 Stocks 450,000 Equipment (net) 627,000 485,000 Current liabilities 250,000 320,000 Long-term liabilities Capital and retained earnings 500,000 400,000 729,000 507,000 Annual sales 1,500,000 1,000,000 Cost of goods sold Salary Other expenses 300,000 600,000 150,000 200,000 175,000 250000

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