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Browse subjects › Prinsip Perakaunan › Analysis and Interpretation of Financial Statements
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Form 5 · Prinsip Perakaunan · iSchool.myChapter 1: Analysisand Interpretation ofFinancial StatementsGross profit margin–Formula: Gross profit ÷Net sales × 100%–Worked example: GPRM24,000; sales RM80,000–24,000 ÷ 80,000 × 100%Answer: 30%Interpretation: RM0.30gross profit per RM1 salesNet profit margin–Formula: Net profit ÷Net sales × 100%–Worked example: NPRM12,000; sales RM80,000–12,000 ÷ 80,000 × 100%Answer: 15%Return on capitalemployed–Formula: Net profit ÷Average capital × 100%–Worked example–Opening capital RM50,000;closing RM70,000Average capital =RM60,000ROCE = 12,000 ÷ 60,000 ×100% = 20%Current ratio–Formula: Currentassets ÷ Current liabilities–Worked example: CARM30,000; CL RM15,000–30,000 ÷ 15,000Answer: 2 : 1Inventory turnover–Formula: Cost of sales÷ Average inventory–Worked example–Opening RM8,000; closingRM12,000Average inventory =RM10,000Cost of sales RM50,000 ÷10,000 = 5 timesComparison andrecommendation–Compare with previousyear or competitorState whether ratioimproved or worsenedGive cause and practicalaction