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

Analysis and communication of accounting information — practice question

Ayesha has supplied the following extracts from her business’s financial statements. All purchases are made on credit. Two-thirds of sales are on a credit basis.
(a(i))[2]

Calculate the following ratios. State the formula used. Trade payables turnover, in days.

(a(ii))[2]

Calculate the following ratios. State the formula used. Trade receivables turnover, in days.

(a(iii))[2]

Calculate the following ratios. State the formula used. Current ratio, to two decimal places.

(b)[7]

Analyse the direction of change in Ayesha’s business’s liquidity.

(c)[2]

State two factors that should be taken into account when selecting businesses for comparison with a business.

Worked solution & mark scheme

This 15-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Trade payables ÷ credit purchases \times 365” …

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