Calculation of efficiency ratios, Financial Accounting

Assignment Help:

 

Calculation of Efficiency ratios  -

     
         
   

2008

2009

2010

M

Net Sales

8506616

11993699

16064038

N

Inventory

1388168

2030972

2651760

O

Total Assets

3103645

4049092

5131809

P

Accounts Receivables

57662

90380

95928

Q

Current Assets

1784275

2353271

2905145

R

Current Liabilities

992683

1340291

1743763

S

Working Capital

791592

1012980

1161382

T

Cost of Goods Sold

6361271

9053219

12281744

         
 

Inventory Turnover (T / N)

4.58

4.46

4.63

         
 

Asset Turnover (M / O)

2.74

2.96

3.13

         
 

Receivables Turnover (M / P)

147.53

132.70

167.46

         
 

Net Working Capital Turnover (M / S)

10.75

11.84

13.83

The turnover ratios as above are showing a mixed trend. i.e. Working Capital and Asset turnover has shown continuous improvement over the last two years but Receivables and inventory have not been properly managed in 2009.

The firm needs to focus on management of receivables and inventory, though there has been an improvement in the receivables turnover and inventory turnover in 2010, they are not stable and sufficient steps should be taken so as to ensure continuous efficiency in assets utilization.


Related Discussions:- Calculation of efficiency ratios

Powers of trustee-rights and duties of trustee, Powers of trustee (A) ...

Powers of trustee (A) Of his own initiative, he may: 1.    Sell and transfer any part of the bankrupt's property; 2.    Gives receipts for money received; 3.    Take all n

Prepare the journal book, On January 1, 2014, Offshore Corporation erected ...

On January 1, 2014, Offshore Corporation erected a drilling platform at a cost of $5,420,142. Offshore is legally required to dismantle and remove the platform at the end of its 6

What is the cash flow from assets for 2010, The following question are base...

The following question are based on above table:- Question 1 What is the change in net working capital from 2009 to 2010? Question 2 What is net capital spending for 20

Sugar and Spice bakery, Perform a business size-up of Sugar and Spice Baker...

Perform a business size-up of Sugar and Spice Bakery. 2. Qualitatively analyze the opportunity of closing the storefront to cater events.

Prepare a post-closing trial balance, Ocean Atlantic Co. is a merchandising...

Ocean Atlantic Co. is a merchandising business. the account balances for Ocean Atlantic co. as of July 1, 2012 (unless otherwise indicated), are as follows: 110 Cash 63,600 1

Explain a reduction in expected inflation - prices and wages, Assume that p...

Assume that prices and wages adjust rapidly so that the markets for labor, goods, and assets are always in equilibrium. What are the effects of each of the following on real money

Efficiency ratios, Efficiency Ratios - These ratios include Receivables T...

Efficiency Ratios - These ratios include Receivables Turnover, Inventory Turnover, Asset Turnover and Net Working Capital Turnover ratios. Efficiency ratios demonstrate the utili

AS-10.., WHAT IS dEPRECIATION?

WHAT IS dEPRECIATION?

Horizontal analysis - total current liabilities, 1. Complete a horizontal a...

1. Complete a horizontal analysis using the dollar and percent change in the following items from the preceding year to the current year: (one typed page: use a table format with f

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd