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Quation Z She hus aked fier your help te caloulate wame of the restios she so...
Oct 6, 2024
Solution by Steps
step 1
To calculate the Gross Profit Percentage for Bally Ltd, we use the formula: Gross Profit Percentage=(Gross ProfitSales Revenue)×100\text{Gross Profit Percentage} = \left( \frac{\text{Gross Profit}}{\text{Sales Revenue}} \right) \times 100. First, we need to find the Gross Profit, which is calculated as: Gross Profit=Sales Revenue−Cost of Sales\text{Gross Profit} = \text{Sales Revenue} - \text{Cost of Sales}
step 2
For Bally Ltd, the Sales Revenue is given as 5000 5000 and the Cost of Sales is 3000 3000 . Thus, Gross Profit is: Gross Profit=5000−3000=2000\text{Gross Profit} = 5000 - 3000 = 2000. Now, substituting into the Gross Profit Percentage formula: Gross Profit Percentage=(20005000)×100=40%\text{Gross Profit Percentage} = \left( \frac{2000}{5000} \right) \times 100 = 40\%
step 3
Now, we calculate the Net Profit Percentage for Bally Ltd using the formula: Net Profit Percentage=(Net ProfitSales Revenue)×100\text{Net Profit Percentage} = \left( \frac{\text{Net Profit}}{\text{Sales Revenue}} \right) \times 100. The Net Profit is given as 1000 1000
step 4
Substituting into the Net Profit Percentage formula: Net Profit Percentage=(10005000)×100=20%\text{Net Profit Percentage} = \left( \frac{1000}{5000} \right) \times 100 = 20\%
step 5
Next, we calculate the Asset Turnover Ratio for Bally Ltd using the formula: Asset Turnover Ratio=Sales RevenueTotal Assets\text{Asset Turnover Ratio} = \frac{\text{Sales Revenue}}{\text{Total Assets}}. The Total Assets for Bally Ltd is 361295 361295
step 6
Substituting into the Asset Turnover Ratio formula: Asset Turnover Ratio=5000361295≈0.0139\text{Asset Turnover Ratio} = \frac{5000}{361295} \approx 0.0139
step 7
Now, we calculate the Current Ratio for Bally Ltd using the formula: Current Ratio=Current AssetsCurrent Liabilities\text{Current Ratio} = \frac{\text{Current Assets}}{\text{Current Liabilities}}. The Current Assets for Bally Ltd is 200000 200000 and Current Liabilities is 137088 137088
step 8
Substituting into the Current Ratio formula: Current Ratio=200000137088≈1.46\text{Current Ratio} = \frac{200000}{137088} \approx 1.46
step 9
Next, we calculate the Quick Ratio for Bally Ltd using the formula: Quick Ratio=Current Assets−InventoryCurrent Liabilities\text{Quick Ratio} = \frac{\text{Current Assets} - \text{Inventory}}{\text{Current Liabilities}}. The Inventory for Bally Ltd is 69606 69606
step 10
Substituting into the Quick Ratio formula: Quick Ratio=200000−69606137088≈1.10\text{Quick Ratio} = \frac{200000 - 69606}{137088} \approx 1.10
step 11
Now, we calculate the Receivables Collection Period for Bally Ltd using the formula: Receivables Collection Period=(ReceivablesSales Revenue)×365\text{Receivables Collection Period} = \left( \frac{\text{Receivables}}{\text{Sales Revenue}} \right) \times 365. The Receivables for Bally Ltd is 36406 36406
step 12
Substituting into the Receivables Collection Period formula: Receivables Collection Period=(364065000)×365≈26.4 days\text{Receivables Collection Period} = \left( \frac{36406}{5000} \right) \times 365 \approx 26.4 \text{ days}
Answer
Gross Profit Percentage: 40%, Net Profit Percentage: 20%, Asset Turnover Ratio: 0.0139, Current Ratio: 1.46, Quick Ratio: 1.10, Receivables Collection Period: 26.4 days
Key Concept
Financial ratios are used to evaluate the performance and financial health of a company.
Explanation
The calculated ratios provide insights into profitability, liquidity, and efficiency, which are essential for making informed investment decisions.
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