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Accounting for Managers: Calculation of Ratios, Comparison of Ratios, Accounting Treatment of Transactions

Question 1 Total marks for Q1. (15 marks) Financial statements of Nimbin Pty Ltd are presented below: Nimbin P/L Statement of Financial Position As at 30 June 2013 and 2014 ($000) Current assets Cash and cash equivalents Accounts receivables (all trades) Inventories Total current assets Non-current assets Property, plant and equipment Total non-current assets Total assets 2014 2013 $1,645 4,100 7,000 ______ 12,745 ______ $2,110 3,675 6,930 _____ 12,715 ______ 17,190 _______ 17,190 _______ $29,935 ======= 15,330 ______ 15,330 _______ $28,045 ====== Current liabilities ACC00724 Accounting for Managers, Assignment 1, S3 2017 Page 1 of 6 Payables Total current liabilities Non-current liabilities Interest-bearing liabilities Total non-current liabilities Total liabilities Equity Share capital Retained earnings Total equity $5,780 _______ 5,780 _______ $5,990 ______ 5,990 ______ 9,940 _______ 9,940 _______ $15,720 ====== 9,450 _____ 9,450 _______ $15,440 ====== $7,700 6,515 _______ $14,215 ====== $7,700 4,905 _______ $12,605 ====== Nimbin P/L Income Statement As at 30 June 2014 ($000) Revenues (net sales) Less: cost of sales Gross profit $55,000 35,100 _______ 19,900 _______ Less: Expenses ACC00724 Accounting for Managers, Assignment 1, S3 2017 Page 2 of 6 Selling and distribution expenses Administrative expenses

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Added on  2023-06-15

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This report analyzes the financial statements of Nimbin Pty Ltd and calculates various ratios to determine the company's profitability and liquidity. It also discusses the effect of various transactions on the financial statements. The report concludes that the day-to-day business transactions will definitely affect company’s financial statements.

Accounting for Managers: Calculation of Ratios, Comparison of Ratios, Accounting Treatment of Transactions

Question 1 Total marks for Q1. (15 marks) Financial statements of Nimbin Pty Ltd are presented below: Nimbin P/L Statement of Financial Position As at 30 June 2013 and 2014 ($000) Current assets Cash and cash equivalents Accounts receivables (all trades) Inventories Total current assets Non-current assets Property, plant and equipment Total non-current assets Total assets 2014 2013 $1,645 4,100 7,000 ______ 12,745 ______ $2,110 3,675 6,930 _____ 12,715 ______ 17,190 _______ 17,190 _______ $29,935 ======= 15,330 ______ 15,330 _______ $28,045 ====== Current liabilities ACC00724 Accounting for Managers, Assignment 1, S3 2017 Page 1 of 6 Payables Total current liabilities Non-current liabilities Interest-bearing liabilities Total non-current liabilities Total liabilities Equity Share capital Retained earnings Total equity $5,780 _______ 5,780 _______ $5,990 ______ 5,990 ______ 9,940 _______ 9,940 _______ $15,720 ====== 9,450 _____ 9,450 _______ $15,440 ====== $7,700 6,515 _______ $14,215 ====== $7,700 4,905 _______ $12,605 ====== Nimbin P/L Income Statement As at 30 June 2014 ($000) Revenues (net sales) Less: cost of sales Gross profit $55,000 35,100 _______ 19,900 _______ Less: Expenses ACC00724 Accounting for Managers, Assignment 1, S3 2017 Page 2 of 6 Selling and distribution expenses Administrative expenses

   Added on 2023-06-15

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Running Head: ACCOUNTING FOR MANAGERS
accounting concepts
Accounting for Managers: Calculation of Ratios, Comparison of Ratios, Accounting Treatment of Transactions_1
Accounting for Managers 1
Contents
Introduction................................................................................................................................2
Calculation of Ratios..................................................................................................................2
Comparison of Ratios.................................................................................................................5
Accounting treatment of transactions.........................................................................................6
Conclusion..................................................................................................................................7
References..................................................................................................................................8
Accounting for Managers: Calculation of Ratios, Comparison of Ratios, Accounting Treatment of Transactions_2
Accounting for Managers 2
Introduction
Analysis of final accounts of a company reflects its financial position in the market. This
analysis is done to know about the overall financial condition of a company (Vogel,
2014).This report shows the calculation of various ratios on the basis of financial statements
of Nimbin Pty Ltd and their comparison with the industry standards in order to determine
profitability and liquidity of the company. The report also indicates the effect of various
transactions on the financial statements prepared by a company.
Calculation of Ratios
Liquidity ratio
2014
Current ratio 2.21
Quick ratio 0.99
Current ratio: Current Assets ÷ Current Liabilities
$12745 ÷ $5780 = 2.21:1
Industry Average: 2.5:1
Quick Ratio: (Current Assets – Inventory) ÷ Current Liabilities
($12,745 - $7,000) ÷ $5780 = 0.99:1
Industry Average: 1.3:1
Accounting for Managers: Calculation of Ratios, Comparison of Ratios, Accounting Treatment of Transactions_3

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