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    Lab Exercise 2

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    arisu
    The document provides financial information for ABC Corporation for years 201B and 201A. It shows that the company's total assets increased from ₱15,081,000 in 201A to ₱17,197,000 in 201B, driven by increases in noncurrent assets and common stock. Total liabilities decreased from ₱5,645,000 to ₱4,820,000 over the same period. The company's net income for 201B was ₱154,000, representing a 6% profit margin.

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    Lab Exercise 2

    Uploaded by

    arisu
    1K views4 pages
    The document provides financial information for ABC Corporation for years 201B and 201A. It shows that the company's total assets increased from ₱15,081,000 in 201A to ₱17,197,000 in 201B, driven by increases in noncurrent assets and common stock. Total liabilities decreased from ₱5,645,000 to ₱4,820,000 over the same period. The company's net income for 201B was ₱154,000, representing a 6% profit margin.

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    _LabExercise2

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    The document provides financial information for ABC Corporation for years 201B and 201A. It shows that the company's total assets increased from ₱15,081,000 in 201A to ₱17,197,000 in 201B, driven by increases in noncurrent assets and common stock. Total liabilities decreased from ₱5,645,000 to ₱4,820,000 over the same period. The company's net income for 201B was ₱154,000, representing a 6% profit margin.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    1K views4 pages

    Lab Exercise 2

    Uploaded by

    arisu
    The document provides financial information for ABC Corporation for years 201B and 201A. It shows that the company's total assets increased from ₱15,081,000 in 201A to ₱17,197,000 in 201B, driven by increases in noncurrent assets and common stock. Total liabilities decreased from ₱5,645,000 to ₱4,820,000 over the same period. The company's net income for 201B was ₱154,000, representing a 6% profit margin.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 4

    ABC Corporation

    Comparative Statement of Financial Position


    For the Year Ended 201B and 201A (in pesos)
    Horizontal Analysis
    201B 201A Peso Change
    Cash and CashEquivalents ₱ 1,633.00 ₱ 1,396.00 ₱ 237.00
    Receivables ₱ 1,209.00 ₱ 1,074.00 ₱ 135.00
    Inventories ₱ 883.00 ₱ 707.00 ₱ 176.00
    Prepaid Expenses ₱ 1,139.00 ₱ 1,413.00 -₱ 274.00
    Total Current Assets ₱ 4,864.00 ₱ 4,590.00 ₱ 274.00
    Noncurrent Assets ₱ 12,333.00 ₱ 10,491.00 ₱ 1,842.00
    Total Assets ₱ 17,197.00 ₱ 15,081.00 ₱ 2,116.00

    Current Liabilities ₱ 4,820.00 ₱ 5,645.00 -₱ 825.00


    Long-term Liabilities ₱ 3,199.00 ₱ 2,528.00 ₱ 671.00
    Common Stock ₱ 4,379.00 ₱ 2,909.00 ₱ 1,470.00
    Retained Earnings ₱ 4,800.00 ₱ 4,000.00 ₱ 800.00
    Total Liabilities and Equity ₱ 17,197.00 ₱ 15,081.00 ₱ 2,116.00

    ABC Corporation
    Income Statement
    For the Year Ended 201B (in pesos)
    Vertical Analysis
    201B Percentage

    Sales ₱ 2,500.00 100%


    Less: Cost of Goods Sold ₱ 1,800.00 72%
    Gross Profit ₱ 700.00 28%
    Less: Operating expenses ₱ 300.00 12%
    Income from operations ₱ 400.00 16%
    Less: Interest expense ₱ 180.00 7%
    Income before taxes ₱ 220.00 9%
    Less: Income tax ₱ 66.00 3%
    Net Income ₱ 154.00 6%

    Agricultural Services Answer Year 1


    Ratio
    Industry Averages and Year 2

    Liquidity Ratios

    1. Net working capital -1055.00 44.00


    2.Current Ratio 1.3 0.81 1.01

    3. Acid-test ratio 0.73 0.44 0.59

    Asset Management Ratios

    4. Account Receivable Turnover 13.04 2.19

    5. Inventory Turnover 14.6 2.26

    Solvency Ratios

    6. Debt Ratio 69% 0.54 0.47

    7. Debt-to-Equity ratio 40% 1.18 0.87

    8. Times-Interest-Earned 4.83 2.22 2.22

    Profitability Ratios

    9. Profit Margin 2.70% 0.06 0.06

    10. Gross Profit Ratio 32.10% 0.28 0.28


    % Change
    17%
    13%
    25%
    -19%
    6%
    18%
    14%

    -15%
    27%
    51%
    20%
    14%

    Interpretation

    Interpreting the Net Working Capital. It means that the


    company has enough current assets to meet its
    current liabilities.
    The current ratio reveals how much “cover” the
    business has for every £1 that is owed by the firm.

    The acid-test ratio, also known as the quick ratio,


    measures the liquidity of a company. Ideally,
    companies should have a ratio of a 1.0 or greater.

    The accounts receivable turnover ratio measures a


    company's effectiveness in collecting its receivables or
    money owed by clients.
    Inventory turnover is a ratio showing how many times
    a company has sold and replaced inventory during a
    given period.

    The debt ratio is defined as the ratio of total debt to


    total assets, expressed as a decimal or percentage.

    The debt-to-equity (D/E) ratio is calculated by dividing


    a company's total liabilities by its shareholder equity.

    he times interest earned (TIE) ratio is a measure of a


    company's ability to meet its debt obligations based
    on its current income.

    Profit margin gauges the degree to which a company


    or a business activity makes money, essentially by
    dividing income by revenues.

    It measures the gross profit percentage on sales to


    recover operating expenses.

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