Current ratio

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Morning star plc. is a manufacturer of computer accessories. The following are selected items appearing in the income statement and balance sheet for the year ended December 31st, 2015.

Income Statement

Net Sales

540,000

Less: Cost of Goods Sold

324,000

Gross Profit

216,000

Selling and general expenses

154,800

Net Operating profit

61,200

Interest expenses

7,200

Net Profit before ta

54,000

Income tax 35%

16,200

Net profit for the year

37,800

Balance Sheet

Cash and short-term investments

9,600

Receivables

45,600

Inventories

48,000

Property, plant & Equipment

385,200

Total Assets

360,000

Total current liabilities

48,000

Total Non-current liabilities

72,000

Shareholder’s Equity $10 par

96,000

Retained Earnings

144,000

Total Liabilities and Equity

360,000

Required:

Using the information above, compute the Company’s ratio below and comment on each:

a. Current ratio

b. Asset Turnover

c. EPS

d. Interest cover

e. Gearing ratio  EXCELLENT 100% CUSTOM ESSAY WRITING SERVICEGET YOUR QUALITY 100% CUSTOM RESEARCH PAPER TODAY

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