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

Assertion, Assertion -Implicit or explicit representations by an entity's m...

Assertion -Implicit or explicit representations by an entity's management which are embodied infinancial statement components and for which AUDITOR obtains and evaluates evidential

Ratios, equity share capital rs 10 200 10% preference share capital 80 15%...

equity share capital rs 10 200 10% preference share capital 80 15% debenture 20 profit before interest and taxes 60 proposed dividend 20 provision fo

Illustration of pension funds, Normal 0 false false false ...

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4

What is asset acquisition, Asset Acquisition An alternate way of condu...

Asset Acquisition An alternate way of conducting a buyout by purchasing few assets an industry may have inspite of purchasing that organizations stock.

Income account-trusts laws and accounts, INCOME ACCOUNT (a) Classific...

INCOME ACCOUNT (a) Classification : Income will be classified under appropriate headings: Rents; Interest on Government securities; Dividends; Interest on

Market value of the entire corporation, Company X is presumably doing well....

Company X is presumably doing well. The corporation's balance sheet last September 31 can be summarized as follows: Total Assets

Types of assets and liabilities, how many types of assets and liabilities a...

how many types of assets and liabilities are there? list of those types required

Quantitative performance measure, The managerial performance measure must b...

The managerial performance measure must be quantitative and the manner in which it is to be calculated should be specified. The managerial performance measure must ideally be linke

What is the net cash provided by investing activities, Zoum Corporation had...

Zoum Corporation had the following transactions during 2014: 1. Issued $125,000 of par value common stock for cash. 2. Recorded and paid wages expense of $60,000. 3. Acquired land

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