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Harbins Analysis

The document contains calculations of key financial metrics for a company: (1) Return on capital employed was 7.5%, calculated as net operating profit divided by capital employed. (2) Net assets turnover was 1.3 times, calculated as net sales divided by average total assets. (3) Net profit margin was 6.4%, calculated as net profit before tax divided by net sales. (4) Current ratio was 0.86, calculated as current assets divided by current liabilities.

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Ummu Zubair
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80 views1 page

Harbins Analysis

The document contains calculations of key financial metrics for a company: (1) Return on capital employed was 7.5%, calculated as net operating profit divided by capital employed. (2) Net assets turnover was 1.3 times, calculated as net sales divided by average total assets. (3) Net profit margin was 6.4%, calculated as net profit before tax divided by net sales. (4) Current ratio was 0.86, calculated as current assets divided by current liabilities.

Uploaded by

Ummu Zubair
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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i) Return on year-end capital employed =

Net Operating
Profit


Total Assets - Current Liabilities


= $16,000,000

$258,000,000 -
$44,000,000



= $16,000,000


$214,000,000



= 7.5%


ii) Net assets turnover

= Net Sales


Average Total Assets



= $250,000,000


($258,000,000+$127,000,000)/2


= 1.3 times


iii) Net Profit(before tax) margin =
Net profit(before
tax)


Net Sales



= $16,000,000


$250,000,000



= 6.4 %



iv)
Current
Ratio = Current Assets


Current Liabilities



= $38,000,000


$44,000,000



= 0.86

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