Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. additional information all purchases and sales of

ADDITIONAL INFORMATION All purchases and sales of inventories are on credit. Inventories, debtors, and creditors...

60.1K

Verified Solution

Question

Accounting

image

image

ADDITIONAL INFORMATION All purchases and sales of inventories are on credit. Inventories, debtors, and creditors at the year end of 2020 were R2 405000 , R3 435000 , and R3 516400 respectively. Debtors are offered 30 days of credit terms. The new shares were issued to existing shareholders at a discount during 2022. Mangwanani's shares were trading at R2.50 and R3.00 as at 31 December 2021 and 31 December 2022, respectively. QUESTION 4 (22 Marks) Answer the following questions. Where applicable, answers to ratios must be expressed to two decimal places. 4.1. Calculate the following ratios for 2021 and 2022, and comment on the values obtained: 4.1.1. Gross margin 4.1.2. Profit margin 4.1.3. Inventory turnover 4.1.4. Debtors' collection period. 4.1.5. Creditors' payment period (Note: Purchases = Cost of sales + Closing inventory - Opening inventory). 4.1.6. Current ratio 4.2. Based on the results of the ratios analysis conducted in section 4.1 , above, specify the main risk confronting Mangwanani Enterprises and recommend a probable solution. ( 3 marks) (3 marks) (3 marks) (3 marks) (3 marks) (3 marks) (4 marks) BCOM ENTR Finan

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students