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Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Statement of Comprehensive Income for the year ended 30 November:
| 2019 | 2018 | |
|---|---|---|
| Profit before interest and tax | GH¢2,200,000 | GH¢1,570,000 |
| Interest expense | (GH¢170,000) | (GH¢150,000) |
| Profit before tax | GH¢2,030,000 | GH¢1,420,000 |
| Taxation | (GH¢730,000) | (GH¢520,000) |
| Profit after tax | GH¢1,300,000 | GH¢900,000 |
| Dividends paid | (GH¢250,000) | (GH¢250,000) |
| Retained profit | GH¢1,050,000 | GH¢650,000 |
Statement of Financial Position as at 30 November:
| 2019 | 2018 | |
|---|---|---|
| Non-current assets (written-down value) | GH¢6,350,000 | GH¢5,600,000 |
| Current assets | ||
| Trade receivables | GH¢2,100,000 | GH¢2,070,000 |
| Inventories | GH¢1,710,000 | GH¢1,540,000 |
| Total current assets | GH¢3,810,000 | GH¢3,610,000 |
| Creditors: amounts due within one year | ||
| Trade payables | GH¢1,040,000 | GH¢1,130,000 |
| Taxation | GH¢550,000 | GH¢450,000 |
| Bank overdraft | GH¢370,000 | GH¢480,000 |
| Total current liabilities | GH¢1,960,000 | GH¢2,060,000 |
| Net current assets | GH¢1,850,000 | GH¢1,550,000 |
| Total net assets | GH¢8,200,000 | GH¢7,150,000 |
| Creditors: amounts due after more than one year | ||
| 10% debentures | GH¢1,500,000 | GH¢1,500,000 |
| Equity | ||
| Share capital (ordinary shares of 50p fully paid up) | GH¢3,000,000 | GH¢3,000,000 |
| Retained earnings | GH¢3,700,000 | GH¢2,650,000 |
| Total equity | GH¢6,700,000 | GH¢5,650,000 |
| Total long-term liabilities and equity | GH¢8,200,000 | GH¢7,150,000 |
Required:
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Shop First Ltd operates supermarket chains across the sixteen (16) regions of Ghana. The firm has been in commercial operation for more than two decades, growing its operations through an effective supply chain and financial management. However, in the last few years, keen competition and worsening general economic performance have steadied the consistent growths experienced over the years, resulting in the entity disposing off part of its operations. Below are the financial statements of Shop First Ltd:
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Below are the recently issued financial statements of Madina Ltd, a listed company, for the year ended 30 September 2018, together with comparatives for 2017.
| Details | 2018 (GH¢’000) | 2017 (GH¢’000) |
|---|---|---|
| Revenue | 125,000 | 90,000 |
| Cost of Sales | (100,000) | (75,000) |
| Gross Profit | 25,000 | 15,000 |
| Operating Expenses | (13,000) | (11,000) |
| Finance Costs | (4,000) | – |
| Profit before Tax | 8,000 | 4,000 |
| Tax (at 25%) | (2,000) | (1,000) |
| Profit for the year | 6,000 | 3,000 |
| Details | 2018 (GH¢’000) | 2017 (GH¢’000) |
|---|---|---|
| Non-Current Assets | ||
| Property, Plant, and Equipment | 105,000 | 45,000 |
| Goodwill | 5,000 | – |
| Total Non-Current Assets | 110,000 | 45,000 |
| Current Assets | ||
| Inventory | 12,500 | 7,500 |
| Receivables | 6,500 | 4,000 |
| Bank | – | 7,000 |
| Total Current Assets | 19,000 | 18,500 |
| Total Assets | 129,000 | 63,500 |
| Equity and Liabilities | ||
| Equity | ||
| Share Capital | 50,000 | 50,000 |
| Retained Earnings | 7,000 | 6,000 |
| Total Equity | 57,000 | 56,000 |
| Non-Current Liabilities | ||
| 8% Loan Notes | 50,000 | – |
| Current Liabilities | ||
| Bank Overdraft | 8,500 | – |
| Trade Payables | 11,500 | 6,500 |
| Current Tax Payable | 2,000 | 1,000 |
| Total Current Liabilities | 22,000 | 7,500 |
| Total Equity and Liabilities | 129,000 | 63,500 |
Additional Information:
| Details | GH¢’000 |
|---|---|
| Revenue | 35,000 |
| Cost of Sales | (20,000) |
| Gross Profit | 15,000 |
| Operating Expenses | (4,000) |
| Profit before Tax | 11,000 |
| Tax (at 25%) | (2,750) |
| Profit for the year | 8,250 |
Required:
a) Calculate the equivalent ratios for Madina Ltd for 2018:
i) Including the results of Aboabu Ltd acquired during the year. (3 marks)
ii) Excluding all effects of the purchase of Aboabu Ltd. (3 marks)
b) Analyse the performance of Madina Ltd for the year ended 30 September 2018. (5 marks)
c) Analyse the cash position of Madina Ltd as at 30 September 2018. (4 marks)
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Fordland Ltd and Fiatland Ltd are two companies in the garment industry. The following are financial ratios computed by the Research Department of ICAG as part of analyzing companies’ performance industry by industry:
| Ratios | Fordland Ltd | Fiatland Ltd |
|---|---|---|
| Return on Capital Employed (ROCE) | 24.10% | 30% |
| Net Assets Turnover | 1.9 times | 2.5 times |
| Gross Profit Margin | 35% | 20% |
| Net Profit Margin | 10.50% | 38% |
| Current Ratio | 1.0:1 | 2.0:1 |
| Quick Ratio | 0.8:1 | 1.0:1 |
| Inventory Holding Period | 60 days | 90 days |
| Receivables Collection Period | 58 days | 60 days |
| Payables Payment Period | 50 days | 50 days |
| Debt to Equity Ratio | 50% | 30% |
| Dividend Yield | 3% | 2% |
| Dividend Cover | 2 times | 1.5 times |
Required:
Write a report analyzing and comparing the financial performance of Fordland Ltd and Fiatland Ltd. The report should cover operating performance, liquidity, gearing, and investment ratios. (8 marks)
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Azure Plc is a company that trades its ordinary shares on the Ghana Stock Exchange. Below are the statements of profit or loss for the year ended 31 December 2020 and for the first three quarters in 2020 published in line with the Ghana Stock Exchange regulations:
Statements of profit or loss of Azure Plc:
| Description | Year Ended 31 Dec 2020 (Audited) | Quarter 3 (Unaudited) | Quarter 2 (U
naudited) |
Quarter 1 (Unaudited) |
|---|---|---|---|---|
| Revenue | GH¢ 2,829 million | GH¢ 544 million | GH¢ 810 million | GH¢ 624 million |
| Cost of sales | (GH¢ 1,754 million) | (GH¢ 346 million) | (GH¢ 489 million) | (GH¢ 412 million) |
| Gross profit | GH¢ 1,075 million | GH¢ 198 million | GH¢ 321 million | GH¢ 212 million |
| Other operating income | GH¢ 72 million | GH¢ 32 million | GH¢ 21 million | GH¢ 23 million |
| Administrative expenses | (GH¢ 572 million) | (GH¢ 94 million) | (GH¢ 183 million) | (GH¢ 146 million) |
| Distribution costs | (GH¢ 265 million) | (GH¢ 73 million) | (GH¢ 62 million) | (GH¢ 65 million) |
| Finance costs | (GH¢ 15 million) | (GH¢ 11 million) | (GH¢ 2 million) | (GH¢ 2 million) |
| Profit before tax | GH¢ 295 million | GH¢ 52 million | GH¢ 95 million | GH¢ 22 million |
| Tax | (GH¢ 101 million) | (GH¢ 17 million) | (GH¢ 31 million) | (GH¢ 11 million) |
| Profit for the year | GH¢ 194 million | GH¢ 35 million | GH¢ 64 million | GH¢ 11 million |
Additional information:
The following ratios have been calculated for the relevant sector for the year ended 31 December 2020:
Required:
Write a report to the Board of Directors of Azure Plc, analyzing the financial performance and financial position of the company using the above information to assist the Board in determining whether strategic adjustments are required and where, if any.
(20 marks)
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You are the Senior Financial Accountant at Saglema Plc (Saglema), a company that manufactures and sells painting materials in the local market and around the West African sub-region. At the first one-on-one meeting with the recently appointed chairperson of your company’s governing board, she asked you to produce a concise report on Saglema’s cash flow performance relative to that of Adidome Plc (Adidome), a close competitor, over the last two years.
The following are the cash flow statements for the last two years for Saglema and Adidome:
Cash Flow Statements for the Year Ended 31 August 2020 (together with comparatives):
Required:
i) Produce a report showing the comparative analysis of the cash flow performance and situation of Saglema over the last two years, relative to that of Adidome. (15 marks)
ii) Explain TWO (2) uses and THREE (3) limitations of such analysis. (5 marks)
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Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Statement of Comprehensive Income for the year ended 30 November:
| 2019 | 2018 | |
|---|---|---|
| Profit before interest and tax | GH¢2,200,000 | GH¢1,570,000 |
| Interest expense | (GH¢170,000) | (GH¢150,000) |
| Profit before tax | GH¢2,030,000 | GH¢1,420,000 |
| Taxation | (GH¢730,000) | (GH¢520,000) |
| Profit after tax | GH¢1,300,000 | GH¢900,000 |
| Dividends paid | (GH¢250,000) | (GH¢250,000) |
| Retained profit | GH¢1,050,000 | GH¢650,000 |
Statement of Financial Position as at 30 November:
| 2019 | 2018 | |
|---|---|---|
| Non-current assets (written-down value) | GH¢6,350,000 | GH¢5,600,000 |
| Current assets | ||
| Trade receivables | GH¢2,100,000 | GH¢2,070,000 |
| Inventories | GH¢1,710,000 | GH¢1,540,000 |
| Total current assets | GH¢3,810,000 | GH¢3,610,000 |
| Creditors: amounts due within one year | ||
| Trade payables | GH¢1,040,000 | GH¢1,130,000 |
| Taxation | GH¢550,000 | GH¢450,000 |
| Bank overdraft | GH¢370,000 | GH¢480,000 |
| Total current liabilities | GH¢1,960,000 | GH¢2,060,000 |
| Net current assets | GH¢1,850,000 | GH¢1,550,000 |
| Total net assets | GH¢8,200,000 | GH¢7,150,000 |
| Creditors: amounts due after more than one year | ||
| 10% debentures | GH¢1,500,000 | GH¢1,500,000 |
| Equity | ||
| Share capital (ordinary shares of 50p fully paid up) | GH¢3,000,000 | GH¢3,000,000 |
| Retained earnings | GH¢3,700,000 | GH¢2,650,000 |
| Total equity | GH¢6,700,000 | GH¢5,650,000 |
| Total long-term liabilities and equity | GH¢8,200,000 | GH¢7,150,000 |
Required:
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Shop First Ltd operates supermarket chains across the sixteen (16) regions of Ghana. The firm has been in commercial operation for more than two decades, growing its operations through an effective supply chain and financial management. However, in the last few years, keen competition and worsening general economic performance have steadied the consistent growths experienced over the years, resulting in the entity disposing off part of its operations. Below are the financial statements of Shop First Ltd:
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Below are the recently issued financial statements of Madina Ltd, a listed company, for the year ended 30 September 2018, together with comparatives for 2017.
| Details | 2018 (GH¢’000) | 2017 (GH¢’000) |
|---|---|---|
| Revenue | 125,000 | 90,000 |
| Cost of Sales | (100,000) | (75,000) |
| Gross Profit | 25,000 | 15,000 |
| Operating Expenses | (13,000) | (11,000) |
| Finance Costs | (4,000) | – |
| Profit before Tax | 8,000 | 4,000 |
| Tax (at 25%) | (2,000) | (1,000) |
| Profit for the year | 6,000 | 3,000 |
| Details | 2018 (GH¢’000) | 2017 (GH¢’000) |
|---|---|---|
| Non-Current Assets | ||
| Property, Plant, and Equipment | 105,000 | 45,000 |
| Goodwill | 5,000 | – |
| Total Non-Current Assets | 110,000 | 45,000 |
| Current Assets | ||
| Inventory | 12,500 | 7,500 |
| Receivables | 6,500 | 4,000 |
| Bank | – | 7,000 |
| Total Current Assets | 19,000 | 18,500 |
| Total Assets | 129,000 | 63,500 |
| Equity and Liabilities | ||
| Equity | ||
| Share Capital | 50,000 | 50,000 |
| Retained Earnings | 7,000 | 6,000 |
| Total Equity | 57,000 | 56,000 |
| Non-Current Liabilities | ||
| 8% Loan Notes | 50,000 | – |
| Current Liabilities | ||
| Bank Overdraft | 8,500 | – |
| Trade Payables | 11,500 | 6,500 |
| Current Tax Payable | 2,000 | 1,000 |
| Total Current Liabilities | 22,000 | 7,500 |
| Total Equity and Liabilities | 129,000 | 63,500 |
Additional Information:
| Details | GH¢’000 |
|---|---|
| Revenue | 35,000 |
| Cost of Sales | (20,000) |
| Gross Profit | 15,000 |
| Operating Expenses | (4,000) |
| Profit before Tax | 11,000 |
| Tax (at 25%) | (2,750) |
| Profit for the year | 8,250 |
Required:
a) Calculate the equivalent ratios for Madina Ltd for 2018:
i) Including the results of Aboabu Ltd acquired during the year. (3 marks)
ii) Excluding all effects of the purchase of Aboabu Ltd. (3 marks)
b) Analyse the performance of Madina Ltd for the year ended 30 September 2018. (5 marks)
c) Analyse the cash position of Madina Ltd as at 30 September 2018. (4 marks)
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Fordland Ltd and Fiatland Ltd are two companies in the garment industry. The following are financial ratios computed by the Research Department of ICAG as part of analyzing companies’ performance industry by industry:
| Ratios | Fordland Ltd | Fiatland Ltd |
|---|---|---|
| Return on Capital Employed (ROCE) | 24.10% | 30% |
| Net Assets Turnover | 1.9 times | 2.5 times |
| Gross Profit Margin | 35% | 20% |
| Net Profit Margin | 10.50% | 38% |
| Current Ratio | 1.0:1 | 2.0:1 |
| Quick Ratio | 0.8:1 | 1.0:1 |
| Inventory Holding Period | 60 days | 90 days |
| Receivables Collection Period | 58 days | 60 days |
| Payables Payment Period | 50 days | 50 days |
| Debt to Equity Ratio | 50% | 30% |
| Dividend Yield | 3% | 2% |
| Dividend Cover | 2 times | 1.5 times |
Required:
Write a report analyzing and comparing the financial performance of Fordland Ltd and Fiatland Ltd. The report should cover operating performance, liquidity, gearing, and investment ratios. (8 marks)
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Azure Plc is a company that trades its ordinary shares on the Ghana Stock Exchange. Below are the statements of profit or loss for the year ended 31 December 2020 and for the first three quarters in 2020 published in line with the Ghana Stock Exchange regulations:
Statements of profit or loss of Azure Plc:
| Description | Year Ended 31 Dec 2020 (Audited) | Quarter 3 (Unaudited) | Quarter 2 (U
naudited) |
Quarter 1 (Unaudited) |
|---|---|---|---|---|
| Revenue | GH¢ 2,829 million | GH¢ 544 million | GH¢ 810 million | GH¢ 624 million |
| Cost of sales | (GH¢ 1,754 million) | (GH¢ 346 million) | (GH¢ 489 million) | (GH¢ 412 million) |
| Gross profit | GH¢ 1,075 million | GH¢ 198 million | GH¢ 321 million | GH¢ 212 million |
| Other operating income | GH¢ 72 million | GH¢ 32 million | GH¢ 21 million | GH¢ 23 million |
| Administrative expenses | (GH¢ 572 million) | (GH¢ 94 million) | (GH¢ 183 million) | (GH¢ 146 million) |
| Distribution costs | (GH¢ 265 million) | (GH¢ 73 million) | (GH¢ 62 million) | (GH¢ 65 million) |
| Finance costs | (GH¢ 15 million) | (GH¢ 11 million) | (GH¢ 2 million) | (GH¢ 2 million) |
| Profit before tax | GH¢ 295 million | GH¢ 52 million | GH¢ 95 million | GH¢ 22 million |
| Tax | (GH¢ 101 million) | (GH¢ 17 million) | (GH¢ 31 million) | (GH¢ 11 million) |
| Profit for the year | GH¢ 194 million | GH¢ 35 million | GH¢ 64 million | GH¢ 11 million |
Additional information:
The following ratios have been calculated for the relevant sector for the year ended 31 December 2020:
Required:
Write a report to the Board of Directors of Azure Plc, analyzing the financial performance and financial position of the company using the above information to assist the Board in determining whether strategic adjustments are required and where, if any.
(20 marks)
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You are the Senior Financial Accountant at Saglema Plc (Saglema), a company that manufactures and sells painting materials in the local market and around the West African sub-region. At the first one-on-one meeting with the recently appointed chairperson of your company’s governing board, she asked you to produce a concise report on Saglema’s cash flow performance relative to that of Adidome Plc (Adidome), a close competitor, over the last two years.
The following are the cash flow statements for the last two years for Saglema and Adidome:
Cash Flow Statements for the Year Ended 31 August 2020 (together with comparatives):
Required:
i) Produce a report showing the comparative analysis of the cash flow performance and situation of Saglema over the last two years, relative to that of Adidome. (15 marks)
ii) Explain TWO (2) uses and THREE (3) limitations of such analysis. (5 marks)
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