+1 vote
in Class 12 by kratos

The following information has been obtained from the financial statements of a company:

| Particulars | Year 1 | Year 2 |
| Cash | 200 | 160 |
| Sundry Debtors | 320 | 400 |
| Short-term Investments | 200 | 320 |
| Stock | 1840 | 2160 |
| Prepaid expenses | 28 | 12 |
| Total current assets | 2588 | 3052 |
| Total assets | 5600 | 6400 |
| Current liabilities | 640 | 800 |
| Loans | 1600 | 1600 |
| Capital | 2000 | 2000 |
| Retained Earnings | 468 | 812 |

Statement of Profit for the current year

| Sales | 4000 |
| Less: Cost of Goods sold | 2800 |
| Less: Interest | 160 |
| Net Profit | 1040 |
| Less: Taxes @50% | 520 |
| Profit after Taxes | 520 |
| Profit distributed | 220 |

On the basis of the above information, evaluate the financial position of the company w.r.t.:

(i) Liquidity

(ii) Leverage

(iii) Profitability

(iv) Activity

1 Answer

+4 votes
by kratos
 
Best answer
    **Computation of ratios**

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