Reference no: EM13244323
Calculate the following ratios from the quantities stated in the financial statements that you produced in Part A:-
Return on capital employed
Cash conversion cycle (including its constituent elements)
Gearing (defined here as long-term borrowings divided by the total of long-term borrowings plus total equity)
Interest cover
Current ratio
Briefly explain, in no more than 50 words for each ratio what it tells an analyst about this business and its prospects of long-term success.
NB: it is important in this Part to provide a clear numeric trail of your workings in calculating your ratios.
* note that your ratios should be calculated solely from the quantities that you have calculated and included in the financial statements that you produced for part (a);
i.e. as if you were an external investment analyst working solely from a company's externally published financial statements without any access to the inside knowledge of how its business works, such as how far its sales are on credit terms or for cash. This information was relevant in completing Part A in order to prepare these financial statements in the first place, and would be available to those people inside the business who are responsible for its management, but would not normally be known to outsiders.
Attachment:- Accounting.pdf
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