Stock Turnover (based on Closing Stock) Debtors Days Creditors Drawings Cash Sales
Total Expenses Excluding Depreciation Depreciation
60 Mark Question
D. Clancy invested €622,600 into a new business on 01/01/2013. D. Clancy supplied the following information on the 31/12/2013:
3:1 4:1
20% 8 times
2 months 12,000 15,000 50,400 24,000 55,000
The following information is relevant: • Depreciation is calculated at 10% of cost per annum. • Current Assets are stock, cash and debtors. • Drawings include Drawings stock of €5,000. • Current Liabilities consist of creditors and bank of €12,000.
You are required to prepare the: (a) Balance Sheet on 31/12/2013. [30 Marks] (b) Trading Profit and Loss Account for the year ended 31/12/2013. [25 Marks] (c) Comment on the liquidity position of D. Clancy. [5 Marks]
The Use of Ratios Apply ratios to information given to find missing information. You may need to prepare a Balance Sheet first - missing figure is net profit. Prepare skeleton P & L. Fill in what is known. Work from the bottom up to find the rest.
This type of incomplete record question has not been examined in the past but it is on the curriculum. The author suggests that it is a 60 Mark question.