Sustaining Organisational Performance

 

) Calculate the following six ratios for both companies, clearly showing the ratio
formula and figures used: –
(i) Current ratio
(ii) Quick ratio (acid test ratio)
(iii) Receivables collection period
(iv) Return on capital employed
(v) Gross profit percentage
(vi) Net profit percentage
(20% Weighting)
(b) Using the ratios calculated in part (a) prepare a report for the investor providing
comments on the performance and position of Wallace and Gromit.
(30% Weighting)
(c) Suggest what further information might be useful to the potential investor
before they decide in which company to invest.
(20% Weighting)
(d) It has been rumoured that Gromit is planning an expansion of their production
facilities which will cost £2.5million. Discuss how this might be financed and
any problems associated with the methods you have chosen.
(30% Weighting)

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