Accounting 9706 · AS & A Level · Analysis and communication of accounting information
Analysis and communication of accounting information — practice question
Winterbottom plc and Ramsey plc are two comparable trading companies. Their financial statements for internal use are presented below.
(a)[10]
Calculate these ratios for both companies, correct to two decimal places: (i) Income gearing (ii) Earnings per share (iii) Price earnings ratio (iv) Dividend yield (v) Dividend cover.
(b)[10]
Assess both companies’ performance against the industry averages.
(c)[5]
Advise Alfredo on which company he should invest in. Justify your answer.
Worked solution & mark scheme
This 25-mark question has a full step-by-step worked solution and mark scheme.