rose333
Oct 4, 2008, 06:33 AM
Hi can anyone please help me with the following question?
We have the following information for Company X and Company Y for the years-ended 28 February 2007 and 2008.
Company X Company Y
2008 2007 2008 2007
Return on Shareholders Equity 31% 35% 25% 20%
Net Profit before tax (R m) R 5.5 R 6.6 R 5.2 R 4.6
Current Ratio 3.1:1 3.2:1 2.2:1 1.68:1
Acid-test Ratio 0.75:1 1.5:1 1.5:1 0.78:1
Debtors Receivable Period 45 days 60 days 30 days 40 days
Creditors Payment Period 30 days 30 days 40 days 45 days
Stock Turnover Rate 4 times 6 times 9 times 6 times
Gearing Ratio 60 % 40 % 20% 25%
Prepare a report to be presented after an analysis and interpretation of the above information and which company would you recommend, giving reasons for your choice.
Thank you,
Miss Rose
We have the following information for Company X and Company Y for the years-ended 28 February 2007 and 2008.
Company X Company Y
2008 2007 2008 2007
Return on Shareholders Equity 31% 35% 25% 20%
Net Profit before tax (R m) R 5.5 R 6.6 R 5.2 R 4.6
Current Ratio 3.1:1 3.2:1 2.2:1 1.68:1
Acid-test Ratio 0.75:1 1.5:1 1.5:1 0.78:1
Debtors Receivable Period 45 days 60 days 30 days 40 days
Creditors Payment Period 30 days 30 days 40 days 45 days
Stock Turnover Rate 4 times 6 times 9 times 6 times
Gearing Ratio 60 % 40 % 20% 25%
Prepare a report to be presented after an analysis and interpretation of the above information and which company would you recommend, giving reasons for your choice.
Thank you,
Miss Rose