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

Analysis and communication of accounting information — practice question

Consult Source B in the insert.
(a)[2]

State any two comparisons that a business can make when it uses ratios to judge its performance.

(b(i))[2]

Work out net assets at 31 December 2022.

(b(ii))[2]

Work out retained earnings at 31 December 2022.

(b(iii))[6]

Work out retained earnings at 1 January 2022.

(c(i))[6]

Work out the working capital cycle (round each element up to the next whole day) at 31 December 2022.

(c(ii))[2]

Work out the gearing ratio (to two decimal places).

(d)[5]

Advise the directors of Z plc on whether they ought to be concerned about the company’s working capital cycle. Justify your answer.

Worked solution & mark scheme

This 25-mark question has a full step-by-step worked solution and mark scheme. One marking point: analysis of trends

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