Beach Ltd

Statement of financial performance

For the year ended 31 December 2018 2019
2018 2019
Net sales (all on account) 645,000.00 704,000.00
EXPENSES
Cost of sales 360,000.00 376,000.00
Selling and administrative 138,000.00 145,000.00
Interest expense 7,500.00 9,500.00
Income tax expense 41,850.00 52,050.00
Total expenses 547,350.00 582,550.00
Profit 97,650.00 121,450.00
 Vertical Analysis
2018 2019

Net sales (all on account) 100.00% 100.00%

Cost of sales 55.81% 53.41%

Selling and administrative 21.40% 20.60%
Interest expense 1.16% 1.35%
Income tax expense 6.49% 7.39%
Total expenses 84.86% 82.75%
Profit 15.14% 17.25%

Vertical Analysis= Individual Item / Total Sales * 100

Horizontal Analysis
Differences Percentages

59,000.00 9%

16,000.00 4%
7,000.00 5%
2,000.00 27%
10,200.00 24%
35,200.00 6%
23,800.00 24%
 Beach Ltd
Statement of financial
As at 31 December
2018 2019 Increase
ASSETS
Current assets
Cash 23,000 25,000 2,000
Marketable securities 19,000 15,600 -3,400
Accounts receivable (net) 95,000 110,000 15,000
Inventory 78,000 90,000 12,000
Total current assets 215,000 240,600 25,600
Non-current asset
Property, plant and equipment (net) 465,000 520,000 55,000
Total assets 680,000 760,600 80,600
LIABILITIES AND EQUITY
Current liabilities
Accounts payable 80,700 83,600 2,900
Income taxes payable 24,300 28,000 3,700
Total current liabilities 105,000 111,600 6,600
Non-current liabilities
Notes payable 150,000 184,000 34,000
Total liabilities 255,000 295,600 40,600
Equity Share capital ($5 each) 180,000 200,000 20,000
Retained earnings 245,000 265,000 20,000
Total equity 425,000 465,000 40,000
Total liabilities and equity 680,000 760,600 80,600

Beach Ltd Shares Currently sold 28.50

All Divedends are cash dividends
All sales are credit sales
 Horizontal Analysis Vertical Analysis
Percentage Perccentage

2018 2019
8.70% 3% 3%
-17.89% 3% 2%
15.79% 14% 14%
15.38% 11% 12%
11.91% 32% 32%

11.83% 68% 68%

11.85% 100% 100%

3.59% 12% 11%

15.23% 4% 4%
6.29% 15% 15%

22.67% 22% 24%

15.92% 38% 39%
11.11% 26% 26%
8.16% 36% 35%
9.41% 63% 61%
11.85% 100% 100%
 Beach Ltd
Retained Earnings
As at 31 December
Amount
As at 1st January 2019 245,000.00
surplus for the year 121,450.00
Total 366,450.00
Proposed Dividends 101,450.00
As at 31st December 2019 265,000.00
 Beach Ltd
Ratios
As at 31 December 2019
Current Ratio = Current Assets / Current Liabilities
current assets 2019 (a) 240,600.00
current liabilities 2019 (b) 111,600.00

current ratio=a/b 2.16

Quick Ratio =(Current Assets - Inventory)/Current Liabilities

current assets 2019 (a) 240,600.00

inventory 2019 (b) 90,000.00
current liabilities 2019 ( c ) 111,600.00

Quick ratio=(a-b)/c 1.35

Receivable Turnover= Total sales/Total Receivables

total sales (a) 704,000.00
total receivables (b) 110,000.00

RT=a/b 6.40

Average Collection Period=(Receivables/Sales)*365

receivables (a) 110,000.00
sales (b) 704,000.00

ACP=(a/b)*365 57

Inventory Turnover=Sales/Average inventory

Average inventory= (Beginning inventory+Ending inventory)/2
sales (a) 704,000.00
beginning inventory 78,000.00
ending inventory 90,000.00
Thus Average inventory ( c) 84,000.00

IT=a/c 8

Average Days in Inventory=(ending inventory/cost of good sold)*365

ending inventory (a) 90,000.00
cost of good sold (b) 376,000.00

ADII=(a/b)*365 87

Profit Margin=(Net Income/Net Sales)%

 net income (a) 121,450.00
net sales (b) 704,000.00

PM=(a/b)% 17%

Asset Turnover Ratio= Net sales/average assets

average assets=(beginning assets+ending assets)/2
net sales (a) 704,000.00
beginning assets (b) 680,000.00
ending assets ( c) 760,600.00

ATR=a/((b+c)/2) 0.98

Return On Assets= Net Income/Average Total Assets

average assets=(beginning assets+ending assets)/2
net income (a) 121,450.00
beginning assets (b) 680,000.00
ending assets ( c) 760,600.00

ROE=a/((b+c)/2) 17%

Return On Ordinary Shareholders Equity=Net Income/Average Shareholders Equity

average equity=(beginning equity+ending equity)/2
net income (a) 121,450.00
beginning equity (b) 425,000.00
ending equity ( c ) 465,000.00

ROE=a/((b+c)/2) 27%

Earning Per Share=(Net income - Preferred Shares)/weighted average common shares outstanding
weighted average common shares outstanding=(biginning shares+ending shares)/2
net income (a ) 121,450.00
beginning shares (b) 36,000.00
ending shares( c) 40,000.00

EPS=a/((b+c)/2) 3.20

Price/Earnings ratio=Market Value per Share/Earning Per Share

market value per share ( a) 28.50
earning per share (b) 3.20

P/E ratio=a/b 8.92

Dividend payout ratio=Dividends paid/Net Income

dividends paid (a ) 101,450.00
 net income (b) 121,450.00

DPR=a/b 84%

Debt Total Assets Ratio=(Short term Debt +Longterm Debt)/Total Assets

Short term debt (A) 110,000.00
Longterm Debt (B) -
total assets ( C) 760,600.00

TA/TD=A+B/C 0.14

Times Interest Earned Ratios=Income Before Interests and Taxes/Interests Expenses

EBIT ( a) 183,000.00
Interests Expenses (b ) 9,500.00

TIER=A/B 19.26
 Beach Ltd
Graphical Presentations
As at 31 December 2019

Income and Expenses 2018 and 2019

2018 2019
INCOME 645,000.00 704,000.00
EXPENSE 547,350.00 582,550.00
NET PROFIT 97,650.00 121,450.00

Chart Title

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INCOME EXPENSE NET PROFIT
2018 2019

HORIZONTAL ANALYSIS OF INCOME STATEMENTS

percentages
Net sales (all on account) 9%
Cost of sales 4%
Selling and administrative 5%
Interest expense 27%
Income tax expense 24%
Total expenses 6%
Profit 24%

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Financial Positions
Total Assets
Less Total Liabilities
Net Assets End Year
2018 2019
680,000.00 760,600.00
- 255,000.00 - 295,600.00
427,018.00 467,019.00

Chart Title

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2018 2019

Financial Positions Vertical analysis

2018 2019
Cash 23,000 25,000
Marketable securities 19,000 15,600
Accounts receivable ( 95,000 110,000
Inventory 78,000 90,000
Property, plant and eq 465,000 520,000
Accounts payable 80,700 83,600
Income taxes payable 24,300 28,000
Notes payable 150,000 184,000
Equity Share capital ( 180,000 200,000
Retained earnings 245,000 265,000

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2018 2019