FIN2601 Assignment 1 (Answers) Semester 1 (2 in 1) - DUE 17 April 2025

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TAKE YOUR PICK (OPTION A or B)
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OPTION A FOR OPTION A

QUESTION 1 [18 MARKS]
1.1 Calculate the following ratios for 2023 and 2024: (16 marks)
We will calculate:
1. Gross Profit Margin
2. Average Collection Period
3. Total Asset Turnover
4. Debt Ratio



OPTION B
QUESTION 1
1.1 Ratio Calculations (16 marks)
Here are the calculated ratios for 2023 and 2024:
Ratio 2023 2024
Gross Profit Margin 50% 46.67%
Average Collection Period 66.58 days 99.75 days
Total Asset Turnover 0.80 times 0.857 times
Debt Ratio 50% 57.1%
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, For more assistance and exclusive, unique assignments, contact us on Telegram:
https://t.me/varsity_times




OPTION A
QUESTION 1 [18 MARKS]

1.1 Calculate the following ratios for 2023 and 2024: (16 marks)

We will calculate:

1. Gross Profit Margin

2. Average Collection Period

3. Total Asset Turnover

4. Debt Ratio



Step 1: Gross Profit Margin




From the income statement:

• 2023: Gross Profit = EBIT + Admin expenses = R680 000 + R520 000 = R1 200 000

• 2024: Gross Profit = R800 000 + R600 000 = R1 400 000

Let’s assume Sales and COGS are the unknowns we back-calculate using the Gross Profit.

2023:




But since we only need the margin: