Question 1: The following information is provided for Bright Creative Ltd. A. Calculate for each year: I. Gearing ratio; II. Earnings per share; III. Price earnings ratio (P/E); IV. Dividend yield; V....

Question 1:

The following information is provided for Bright Creative Ltd.

A. Calculate for each year:

I. Gearing ratio;

II. Earnings per share;

III. Price earnings ratio (P/E);

IV. Dividend yield;

V. Dividend pay-out ratio;

VI. Return on owner equity for 2013 and 2014.

B. Discuss any significant trends or anomalies.

Question 2:

The following Ratios are abstracted from the financial reports of Western Digi Ltd, which appear to have a concern with liquidity and efficiency for the years 2012 through to 2014.

MGT200 MANAGEMENT ACCOUNTING AND FINANCE ASSESSMENT 2 Activity Title: Assessment 2 Paper Number and Title: MGT200 – Management Accounting and Finance Learning outcome: No 1,8 Understand the business finance environment. Use management accounting information to assist decision-making in a given business situation Conditions: This is a compulsory assignment. ASSIGNMENT INSTRUCTIONS Question 1: The following information is provided for Bright Creative Ltd. 2012 ‘000 2013 ‘000 2014 ‘000 Net assets 1000 1100 1200 Total liabilities 1200 1600 1500 Paid-up capital ($1)* 800 800 800 Retained earnings & reserves 200 300 400 Profit before interest and tax 270 294 325 Interest 120 160 160 Taxation 45 40 41 Dividends per share $0.05 $0.06 $0.07 Average market price per share $1.08 $1.12 $1.23 * All share initially issued at $1. A. Calculate for each year: I. Gearing ratio; II. Earnings per share; III. Price earnings ratio (P/E); IV. Dividend yield; V. Dividend pay-out ratio; VI. Return on owner equity for 2013 and 2014. B. Discuss any significant trends or anomalies. Question 2: The following Ratios are abstracted from the financial reports of Western Digi Ltd, which appear to have a concern with liquidity and efficiency for the years 2012 through to 2014. Ratio 2012 2013 2014 Industry Average 2014 Current Ratio 1.6:1 1.8:1 1.9:1 2.1:1 Acid Ratio 1.2:1 1.1:1 0.9:1 1.1:1 Inventory turnover period 31.3 days 33.4days 37.9days 27.4days Average settlement period for debtors 47.3 days 45.2days 41.3days 45.1days Average settlement period for creditors 74.5days 70.2days 66.5days 62.1days Working capital cycle (days) 4.1days 8.4days 12.7days 10.4days You as the Management Accountant of Western Digi Ltd, are requested by the CEO to provide a report based on the above analysis.