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Financial Statement Analysis

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Financial Statement Analysis-FIN621
VU
Lesson-41
STOCKHOLDERS' EQUITY SECTION OF THE BALANCE SHEET
(Continued)
Example No:2
MOOSA CORPORATION
Balance Sheet as on June 30, ________
2006
2005
Cash
35,000
25,000
Accounts receivable (net)
91,000
90,000
Inventory
160,000
140,000
Short-term prepayments
4,000
5,000
Investment in land
90,000
100,000
Equipment
880,000
640,000
Less: Accumulated depreciation
(260,000)
(200,000)
Total assets
Rs.1, 000,000
Rs.800, 000
======
=======
2005-06
2004-05
Accounts payable
Rs.105, 000
Rs.46, 000
Income taxes payable and
Other accrued liabilities
40,000
25,000
Bonds payable ­ 8%
280,000
280,000
Premium on bonds payable
3,600
4,000
Capital stock Rs.5 par
165,000
110,000
Retained earnings
406,400
335,000
Total liabilities and stockholders' equity
Rs.1, 000,000
Rs.800, 000
MOOSA CORPORATION
Income Statement for the year
2005-06
2004-05
150
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Financial Statement Analysis-FIN621
VU
Sales (net of discount and allowances)
Rs.2, 200,000
Rs.1, 600,000
Cost of goods sold
1,606,000
1,120,000
Gross profit on sales
Rs. 594,000
Rs. 480,000
Expenses (including Rs.22, 400 Interest expense)
(336,600)
(352,000)
Income taxes
(91,000)
(48,000)
________
________
Net income
Rs.166, 400
Rs.80, 000
========
=======
2005-06
2004-05
1. Quick ratio:
Rs.126, 000 ÷Rs.145, 000
0.9 to 1
Rs.115, 000 ÷ Rs.71, 000
1.6 to 1
2.
Current ratio:
Rs.290, 000 ÷Rs.145, 000
2 to 1
Rs.260, 000 ÷Rs.71, 000
3.7 to 1
3.
Equity ratio:
Rs.571,400 ÷ Rs.1,000,000
57%
Rs.445,000 ÷ Rs.800,000
56%
4.
Debt ratio:
Rs.428,600 ÷ Rs.1,000,000
43%
Rs.355,000 ÷ Rs.800,000
44%
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