Exam (elaborations)
MAC 3702 EXAMS 24 OCTOBER SEMESTER 2 2023
- Course
- Institution
MAC 3702 EXAMS 24 OCTOBER SEMESTER 2 2023.
[Show more]
Seller
Follow
warasmyeko
Reviews received
Content preview
MAC 3702 EXAMSSEMESTER2 2023
24 OCTOBER 2023
DISTINCTION GUARANTEED
OPENED: 24 OCT 2023
CLOSE BY: 24 OCT 2023
, Question 1
Ratio Calculation 2021 2022 Comment
The gross profit margin measures the
company's profitability. A higher
margin is desirable. A significant decline
GP%=Gross profit/Sales
from 2021 to 2022 (10.42% to 5.43%)
i. Gross Profit Margin 2021= 466/4475*100 10.42% 5.43%
indicates a substantial reduction in
2022= 327/6010*100
profitability, possibly due to increased
costs or decreased revenue. This is a
concerning trend.
The EBITDA to revenue ratio indicates
operating performance. A positive value
indicates profit, while a negative value
2022= (-166+19)/6010 suggests a loss. The drop from 5.01% in
ii. EBITDA to Revenue 5.01% -2.45%
2021 = (199+25)/4475 2021 to -2.45% in 2022 signifies a
substantial decline in operating
performance, turning into a loss. This is
a significant concern for the company.
The current ratio measures short-term
liquidity. A ratio above 1 indicates the
2022 company's ability to meet short-term
Current Ratio = 1,453 / obligations. Both 2021 and 2022
947 = 1.53 current ratios are above 1, indicating
iii. Current Ratio 1.50 1.53
2021 good short-term liquidity. There is a
Current Ratio = 1,624 / slight improvement from 2021 to 2022,
1,082 = 1.50 suggesting that the company's short-
term liquidity position has
strengthened slightly.
Use below formulars to
iv. Cash Conversion Cycle
calculate
Cash conversions cycle = inventory days + debtors’ days – creditors days
Creditors days 15 days in 2022 and 90 days in 2021
Inventory days = Inventory/cost of sales *365
Debtors days = debtors/ Revenue * 365
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller warasmyeko. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $20.11. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
67096 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now