Credit Management Practise Exam Task 4

sophie_612

Hi,

I'm hoping someone can help me as I'm really stuck on how to complete this question, I'm unsure how to work out the difference in the % between the years I've looked through my books and online but i cannot seem to come back to these answers.

Really hoping someone can help.

Thanks
Sophie

hal978

The gross profit has fallen in absolute terms by:
(14,177 / 17,215) - 1 = -0.17647 = 17.65% fall

and the increase of:

[(8,598 + 5,595) / (7,535 + 5,357)] - 1 =
(14,193 / 12,892) - 1 = 0.1009 = 10.09%

in combined distribution and administration costs

sophie_612

hal978 said:

The gross profit has fallen in absolute terms by:
(14,177 / 17,215) - 1 = -0.17647 = 17.65% fall

and the increase of:

[(8,598 + 5,595) / (7,535 + 5,357)] - 1 =
(14,193 / 12,892) - 1 = 0.1009 = 10.09%

in combined distribution and administration costs

thanks so much for replying without sounding silly where do you get the -1 from?

hal978

The result would be a ratio or an index if I don't take out the 1 (e.g. 0.8235 or 1.1009). So to convert it to a percentage change, 1 has to be deducted.

Alternatively it could be calculated like this:

[(14,177 - 17,215) / 17,215] = -3,308 / 17,215 = -0.17647 = 17.65% fall

sophie_612

hal978 said:

The result would be a ratio or an index if I don't take out the 1 (e.g. 0.8235 or 1.1009). So to convert it to a percentage change, 1 has to be deducted.

Alternatively it could be calculated like this:

[(14,177 - 17,215) / 17,215] = -3,308 / 17,215 = -0.17647 = 17.65% fall

thank you for helping me with this, the whole task is a bit if a struggle for me do you have any tips for this task?

sophie_612

would anyone be able to tell me how they got to this gearing ratio answer please?

sophie_612

would anyone be able to tell me how they got to this gearing ratio answer of 233.80 please

sophie_612

would anyone be able to tell me how they got to this gearing ratio answer please?

sophie_612 said:

would anyone be able to tell me how they got to this gearing ratio answer of 233.80 please

does anybody have any idea please?

Pian32

Hi Sophie

I didn't do the credit management module. But from the financial statements and D&C.

The Gearing ratio is - Debt/Equity *100

(21500+2750)/10372 *100 = 233.80

I hope this helps might be worth checking the Credit management follows the same rules.

Bran278

Pian32 said:

Hi Sophie

I didn't do the credit management module. But from the financial statements and D&C.

The Gearing ratio is - Debt/Equity *100

(21500+2750)/10372 *100 = 233.80

I hope this helps might be worth checking the Credit management follows the same rules.

I assume that they will also accept D/D+E *100 also? As this calculation gives a completely different figure obviously.

Waiwai86

Hi, sorry to jump in but I got stuck on the same part too. Does anyone know if D/D+E would be accepted as the question does not state different? Also I am struggling to find the credit terms (attached), any help would be appreciated.

Thanks

Waiwai86

Hi, sorry to jump in but I got stuck on the same part too. Does anyone know if D/D+E would be accepted as the question does not state different? Also I am struggling to find the credit terms (attached), any help would be appreciated.

Thanks

Waiwai86

Hi, sorry to jump in but I got stuck on the same part too. Does anyone know if D/D+E would be accepted as the question does not state different? Also I am struggling to find the standard payment terms at the end of the liquidity part, any help would be appreciated.

Thanks