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Financial Ratio Analysis 2017-2018

This document contains an individual assignment for a Principles of Finance course. It instructs the student named Mud Hafiz Bin Sharin to calculate and compare 10 financial ratios for a company called John Brown for the years 2017 and 2018. The ratios to be calculated are: Gross Profit Ratio, Net Profit Ratio, Return on Equity, Return on Assets, Total Assets Turnover, Inventory Turnover Ratio, Account Receivable Turnover, Average Collection Period, Current Ratio, and Quick Ratio.

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Muhd Hafiz
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19 views6 pages

Financial Ratio Analysis 2017-2018

This document contains an individual assignment for a Principles of Finance course. It instructs the student named Mud Hafiz Bin Sharin to calculate and compare 10 financial ratios for a company called John Brown for the years 2017 and 2018. The ratios to be calculated are: Gross Profit Ratio, Net Profit Ratio, Return on Equity, Return on Assets, Total Assets Turnover, Inventory Turnover Ratio, Account Receivable Turnover, Average Collection Period, Current Ratio, and Quick Ratio.

Uploaded by

Muhd Hafiz
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

BFN 10103

PRINCIPLES OF FINANCE

INDIVIDUAL ASSIGNMENT

LECTURER NAME:MISS SYAFIQAH HANANI

NAME: Mud Hafiz Bin Sharin

[Link] :

COURSE: DIM

DUE DATE:6 MAC 2023


a) Use the following ratios to compare the financial performance from 2017 and 2018 of John
[Link] your answer to a maximum of two decimal places.

(2017)

I. Gross profit ratio:


Gross profit X 100
Sales

= 520 X100
1920
= 0.27 x 100
=27%

Gross profit ratio:


(2018)

Gross profit X 100


Sales

= 650 X100
2180
= 0.30x 100
=30 %

(2017)

II. NET PROFIT RATIO = Net Profit X 100


Sales

= 320 X100
1920
= 0.167
=16.7 %

(2018)
NET PROFIT RATIO = Net Profit X 100
Sales

= 390 X100
2180
= 0.178 X 100
17.8%
(2017)

Return on Equity(ROE) :

iii. Return on Equity = Net Profit X 100


Total Equity

= 320 X100
940
= 0.34 X100
=34 %

(2018)

Return on Equity = Net Profit X 100


Total Equity

= 390 X100
1120
= 0.348 X100
=34.8%

(2017)
Return on Assets (ROA) :

iv. Return on Assets = Net Profit X 100


Total Assets

= 320 X100
1090
= 0.30 X100
=30%

(2018)

Return on Assets = Net Profit X 100


Total Assets

= 390 X 100
1315
= 0.296 X 100
=29.7%
(2017)
Total Assets turnover :

v. Total Assets Turnover = Sales


Total Assets

= 1920
1090
= 1.77x

(2018)

Total Assets Turnover = Sales

Total Assets

= 2180
1315
= 1.67x

(2017)
Inventory Turnover Ratio :

vi. Total Assets Turnover = COGS


Inventory

= 1400
200
= 7x

(2018)

Total Assets Turnover = COGS


Inventory

= 1530
250
= 6.12x
(2017)
Account Receivable Turnover :

vii. Account Receivable Turnover = Sales


Account Receivable

= 1920
130
= 14.77x

(2018)

Account Receivable Turnover = Sales

Account Receivable

= 2180
166
= 13.13x

(2017)
Average Collection Period :

viii. Average Collection Period = Account Receivable X 365 days


Sales

= 130 X 365 days


1920
= 25 days

(2018)

Average Collection Period = Account Receivable X 365 days

Sales

= 166 X 365 days


2180
= 28 days
(2017)
Current Ratio :

ix. Current Ratio = Current Assets


Current Liabilities

= 370
150
= 2.45x

(2018)

Current Ratio = Current Assets

Current Liabilities

=420
195
= 2.15x

(2017)
Quick Ratio :

x. Quick Ratio = Current Assets – inventory


Current Liabilities

= 370 - 200
150
= 1.13 x

(2018)
Quick Ratio :

Quick Ratio = Current Assets – inventory


Current Liabilities

= 420 - 250
195
= 0.87 x

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