Question
In: Accounting
The following financial ratios have been calculated for Nova Ltd for the year ended 30 June 2008
The following financial ratios have been calculated for Nova Ltd for the year ended 30 June 2008: Ratio Actual results Budgeted results Previous year Industry Average Current ratio 1.97 1.92 1.87 1.92 Quick asset ratio 1.06 1.06 1.06 1.11 Inventory turnover 4.21 4.91 4.86 4.76 Net profit ratio 0.05 0.03 0.03 0.03 Gross margin 0.65 0.59 0.61 0.61 Required: Provide four (4) possible explanations for the results of the various ratios for Nova Ltd and explain their implications for the audit. (7marks) (Word Limit: Minimum of 200 words. Maximum 250 of words)
Solutions
ekkarill92 answered 2 years agoRelated Solutions
The following financial ratios have been calculated for Nova Ltd for the year ended 30 June...
The following financial ratios have been calculated for Nova Ltd
for the year ended 30 June 2008:
Actual results
Budgeted results
Previous year
Industry average
current ratio
1.97
1.92
1.87
1.92
Quick asset ratio
1.06
1.06
1.06
1.11
Inventory turnover
4.21
4.91
4.86
4.76
Net profit ratio
0.05
0.03
0.03
0.03
Gross margin
0.65
0.59
0.61
0.61
Required: Provide four (4) possible explanations for the results
for the various ratios for Nova Ltd and outline their implications...
The following financial ratios have been calculated for Nova Ltd for the year ended 30 June...
The following financial ratios have been calculated for Nova Ltd
for the year ended 30 June 2008: Ratio Actual results Budgeted
results Previous year Industry Average Current ratio 1.97 1.92 1.87
1.92 Quick asset ratio 1.06 1.06 1.06 1.11 Inventory turnover 4.21
4.91 4.86 4.76 Net profit ratio 0.05 0.03 0.03 0.03 Gross margin
0.65 0.59 0.61 0.61 Required: Provide four (4) possible
explanations for the results of the various ratios for Nova Ltd and
explain their implications for the...
The following financial ratios have been calculated for Nova Ltd for the year ended 30 June...
The following financial ratios have been calculated for Nova Ltd
for the year ended 30 June 2008:
Actual results Budgeted results
Previous year Industry
average
current ratio
1.97
1.92
1.87 1.92
quickasset ratio
1.06
1.06
1.06 1.11
Inventory turnover 4.21
4.91
4.86 4.76
Net profit ratio 0.05
0.03
0.03
0.03
Gross
margin
0.65
0.59
0.61
0.61
Required: Provide four (4) possible explanations for the results
for the various ratios for Nova Ltd and outline...
Desla Ltd finalised their financial statements for the year ended 30 June 2019 and authorised them...
Desla Ltd finalised their financial statements for the
year ended 30 June 2019 and authorised them for issue on 23 August
2019. The new managing director is unsure about the treatment of
the following eight material events and has asked for your
professional advice.
(i) 20 June 2019 – An error was discovered in the
measurement of cash and accounts payable due to an omitted
transaction. The omitted transaction was for $640 000.
(ii) 20 July 2019 – The directors...
You are auditing Lifetime Tours Ltd for the year ended 30 June 2018. The financial report...
You are auditing Lifetime Tours Ltd for the year ended 30 June
2018. The financial report will be approved and signed by the
directors on 30 July 2018, with the auditor’s report signed on the
same date. The audited financial report will be issued on 12 August
2018.
After 30 June 2018 the following information came to light:
On 1 July 2018, the government issued a travel warning to a
number of African countries. Forty-five per cent of Lifetime Tours’...
The following information relates to a company ABC Ltd for the year ended 30 June 2020:...
The following information relates to a company ABC Ltd
for the year ended 30 June 2020:
Transaction totals for the year ended 30 June
2020
R
Credit purchases of raw materials
503750
Freight on raw materiasl purchased (on
credit)
99833
Sales of finished producgts
11440000
Direct Labour:
Factory wages
828600
Pension fund contributions paid by employer
172500
Medical aid paid by employer
227200
UIF Contributions paid by employer
8144
Indirect Labour
500250
Electricity
Factory
211450
Administration offices
127900
Rent Expenses...
The following data relates to ABC Ltd: • Profit for the year ended 30 June 20X1,...
The following data relates to ABC Ltd: • Profit for the year
ended 30 June 20X1, $500,000. • On 31 March 20X1, the directors
decided to pay an interim cash dividend of $100,000. • On 7 April
20X1, the interim dividend was paid. • For final dividends, the
company’s constitution provides that the directors can recommend a
dividend to be subsequently declared by a resolution of the members
in a general meeting. • The directors recommended a final dividend
of...
The following information is related to Sunglow Solar Ltd: Sales for the year ended 30 June...
The following information is related to Sunglow Solar Ltd:
Sales for the year ended 30 June 2019 was $1,200,000
Provision for warranties before adjustment was $36,000
At 30 June 2019, Sunglow Solar Ltd. adjusted its Provision for
Warranties so that it would be equal to 4% of sales for the year
ended on that date.
On 16 September 2019, a successful claim for warranty on faulty
goods to the cost of $700 was made on Sunglow Solar Ltd.
Required:
Prepare...
he following data relates to ABC Ltd: • Profit for the year ended 30 June 20X1,...
he following data relates to ABC Ltd: • Profit for the year
ended 30 June 20X1, $500,000. • On 31 March 20X1, the directors
decided to pay an interim cash dividend of $100,000. • On 7 April
20X1, the interim dividend was paid. • For final dividends, the
company’s constitution provides that the directors can recommend a
dividend to be subsequently declared by a resolution of the members
in a general meeting. • The directors recommended a final dividend
of...
The following information relates to ABC Pty Ltd for the years ended 30 June Year 3...
The following information relates to ABC Pty Ltd for the years
ended 30 June Year 3 and Year 2: Year 3 $ Year 2 $ Total assets
Owners’ equity 6,020,000 3,250,000 5,470,000 3,200,000 Annual sales
Net profit (after tax) Weighted average number of ordinary shares
issued 6,100,000 810,000 10,234,518 3,154,350 475,200 10,046,430
Required: Calculate the net profit margin, asset turnover, earnings
per share and debt to total assets ratios for ABC Ltd for the year
ended 30 June Year 3
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