Atrium Enterprises Example
Atrium Enterprises Example
Profit or Loss Statement for the year ended 30 June 2022
Revenue (Sales) 2,762,000
less Cost of Goods 1,539,815
Gross Profit 1,222,185
less Other Operating Expenses * 994,255
Profit before tax 227,930
less Tax 68,380
Profit after tax 159,550
* Includes Finance Cost (Interest) = $27,555 Balance Sheet as at 30 June 2021
Current Assets Current Liabilities
Cash 134,600 Accounts Payable 345,000
Accounts Receivable 77,650 Accrued Expenses 120,000
Inventory 337,750 Current Liabilities 465,000
Current Assets 550,000
Non-Current Liabilities 618,000
Non-Current Assets 1,100,000
Total Liabilities 1,083,000
Equity 567,000
Total Assets 1,650,000 Total Liabilities & Equity 1,650,000
Balance Sheet as at 30 June 2022
Current Assets Current Liabilities
Cash 177,200 Accounts Payable 318,000
Accounts Receivable 80,400 Accrued Expenses 80,000
Inventory 317,400 Current Liabilities 398,000
Current Assets 575,000
Non-Current Liabilities 627,000
Non-Current Assets 1,175,000
Total Liabilities 1,025,000
Equity 725,000
Total Assets 1,750,000 Total Liabilities & Equity 1,750,000
Cash Flow Statement for the year ended 30 June 2022
Cash Flow from Operating Activities $128,150
Cash Flow from Investing Activities -$75,000
Cash Flow from Financing Activities -$10,550
Net Cash Flow $42,600
Atrium Enterprises Calculations of Averages
Atrium Enterprises
2021 2022
Total Assets 1,650,000 1,750,000
Average Assets 1,700,000
Accounts Receivable (Trade and Other Receivables) 77,650 80,400
Average Accounts Receivable 79,025
Inventory 337,750 317,400
Average Inventory 327,575
Current Assets 550,000 575,000
Average Current Assets 562,500
Current Liabilities 465,000 398,000
Average Current Liabilities 431,500
Current Assets (less prepayments and Inventories) Current Assets 575,000
Inventories 317,400
Current Assets (less Inventory) 257,600
Shareholders' Equity 567,000 725,000
Average Shareholder's Equity 646,000
Credit Sales Sales (assume credit sales are 15%) 414,300
NOTE: Assignment assumption is 50% of sales are credit Credit Purchases Cost of Sales (as per the P&L Statement) 1,539,815
+ Inventory @ end 317,400
- Inventory @ beginning 337,750
= Purchases (Assume 100% credit) 1,519,465
Net Profit before Interest and Tax Net Profit before Tax 227,930
Add back Finance Costs 27,555
= Net Profit before Interest and Tax 255,485
Net Profit after Interest and Tax Net Profit after Interest and Tax 159,550
RATIO FORMULA SHEET
Profitability
Return on Shareholder's Equity Net Profit After Interest & Tax x 100
Average Shareholder's Equity
Return on Assets Profit Before Interest & Tax x 100
Average Assets
Gross Profit Margin Gross Profit x 100
Sales
Net Profit Margin Profit after Interest & Tax x 100
Sales
Cash flow to sales Cashflow from operating activities x 100
Sales
Efficiency
Days in Inventory Average Inventory x 365
Cost of Sales
Days in Debtors Average Accounts Receivable x 365
Credit Sales
Asset Turnover (times) Sales x 365
Average Assets
Activity Cycle Days Inventory + Days Debtors
Liquidity
Current Ratio Current Assets
Current Liabilities
Quick (Acid) Ratio (Current Assets - Inventory)
Current Liabilities
Cashflow from Operations Operating Cash Flows
Current Liabilities
Capital Structure (Equity/Solvency)
Debt Ratio Total Liabilities x 100
Total Assets
Debt to Equity Ratio Total Liabilities x 100
Total Equity
Equity Ratio Total Equity x 100
Total Assets
Debt Coverage Ratio Non-Current Liabilities
Net Cashflow from Operating Activities
Interest Coverage Profit Before Interest and Tax
Net Finance Costs
Atrium Enterprises
RATIO Calculations
2022 Ratio
Profitability 159,550 24.70%
Return on Shareholder's Equity Net Profit After Interest & Tax x 100 646,000
Average Shareholder's Equity
255,485 15.03%
Return on Assets Profit Before Interest & Tax x 100 1,700,000
Average Assets
1,222,185 44.25%
Gross Profit Margin Gross Profit x 100 2,762,000
Sales
159,550 5.78%
Net Profit Margin Profit after Interest & Tax x 100 2,762,000
Sales
128,150 4.64%
Cash flow to sales Cashflow from operating activities x 100 2,762,000
Sales
Efficiency
Days in Inventory Average Inventory x 365 327,575 x365 77.65 Days
Cost of Sales 1,539,815 4.70 Times p.a.
Days in Debtors Average Accounts Receivable x 365 79,025 x365 69.62 Days
Credit Sales 414,300
Asset Turnover (times) Sales x 365 2,762,000 1.62 Times p.a.
Average Assets 1,700,000
Activity Cycle Days Inventory + Days Debtors 147.27 147.27 Days
Liquidity
Current Ratio Current Assets 575,000 1.44 times
Current Liabilities 398,000
Quick (Acid) Ratio (Current Assets - Inventory) 257,600 0.65 times
Current Liabilities 398,000
Cashflow from Operations Operating Cash Flows 128,150 0.32 times
Current Liabilities 398,000
Capital Structure (Equity/Solvency)
Debt Ratio Total Liabilities x 100 1,025,000 58.57%
Total Assets 1,750,000
Debt to Equity Ratio Total Liabilities x 100 1,025,000 141.38%
Total Equity 725,000
Equity Ratio Total Equity x 100 725,000 41.43%
Total Assets 1,750,000
Debt Coverage Ratio Non-Current Liabilities 627,000 4.89 times
Net Cashflow from Operating Activities 128,150
Interest Coverage Profit Before Interest and Tax 255,485 9.27 times
Net Finance Costs 27,555
