Accounting 9706 · AS & A Level · Analysis and communication of accounting information

Analysis and communication of accounting information — practice question

Johnson plc started trading on 1 January 2010.
(a)[5]

Prepare the equity and liabilities part of the statement of financial position at 31 December 2015.

(b(i))[2]

Calculate the dividend cover for the year ended 31 December 2015.

(b(ii))[2]

Calculate the gearing ratio for the year to 31 December 2015.

(b(iii))[2]

Calculate the return on capital employed for the year ended 31 December 2015.

(c)[9]

Analyse the performance of both companies using all the information available.

(d)[5]

Recommend which company would give the better return on an investment in ordinary shares. Justify your answer.

Worked solution & mark scheme

This 25-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI