Accounting for Managers: Analysis of Financial Ratios of Retail Food Group

Running head: ACCOUNTING FOR MANAGERS
Accounting for Managers
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1ACCOUNTING FOR MANAGERS
Table of Contents
Horizontal analysis of the income statement of Retail Food Group for the years 2013-2017:.......3
Calculation of the different types of ratios of Retail Food Group for the years 2013-2017:..........4
1. Return on total assets:..............................................................................................................4
2. Rate of return on ordinary equity:...........................................................................................4
3. Operating profit margin:..........................................................................................................5
4. Gross profit margin:.................................................................................................................5
5. Inventories turnover period:....................................................................................................5
6. Settlement period for debtors:.................................................................................................5
7. Current ratio:............................................................................................................................5
8. Quick ratio (acid test ratio):.....................................................................................................6
9. Debt to assets ratio:..................................................................................................................6
10. Interest cover ratio (Times interest earned):..........................................................................6
11. Assets turnover:.....................................................................................................................6
12. Earnings per share:................................................................................................................6
13. Price-earnings ratio:...............................................................................................................7
14. Dividend yield:......................................................................................................................7
Analysis of the profitability, efficiency, liquidity, financial gearing and investment ratios of
Retail Food Group:..........................................................................................................................7
References:....................................................................................................................................11

2ACCOUNTING FOR MANAGERS
Appendices:...................................................................................................................................12

3ACCOUNTING FOR MANAGERS
Horizontal analysis of the income statement of Retail Food Group for the years 2013-2017:
Retail Food Group (RFG) is an international food and beverage organisation
headquartered in Queensland, Australia and it is the biggest multi-brand retail franchise owner of
food products in the nation (Retail Food Group 2018). The horizontal analysis of the income
statement of the organisation has been represented below in the form of a table as follows:
From the above table, it is evident that RFG has managed to increase its overall revenue
over the years where it has reached its peak to $245,873,000 in 2017 from $45,086,000 in 2013.
This is further supported by rise in other operating revenue by 16.94% in 2014 and by 12.73% in
2015; however, it has declined by 12.82% in 2016 and by 6.20% in 2017. However, the total
income earned has gone larger considerably due to considerable increase from the rise in sales of
food and beverage products. Such considerable increase in revenue has been attributed to
sustained franchising operations of RFG during the five-year period. The past acquisitions of