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##### FINANCIAL INFORMATION: COURSEWORK ASSIGNMENT

**Description**

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**Question**

FINANCIAL INFORMATION: COURSEWORK ASSIGNMENT

Accounting Coursework in a Word Document up to 1500 words with tables and graphs explaining how the calculations were made. The coursework is on the Tesco Company statements. Three files are attached, file is the coursework explanation, number two is the balance sheet, and number three is some extra information about the Tesco company as a guidance.

The following questions have to be answered.

Question 1:

What is (are) the principal activity(ies) of this business?

2 marks

Question 2:

Comment on the outcome of the auditor’s report for Tesco Plc. Briefly discuss the importance the auditor’s report with respect to financial information.

4 marks

Question 3:

Compute the following ratios, using the table provided below as a template:

32 marks

Profitability

a) Return on equity (ROE)

b) Gross profit margin

c) Net profit margin

Liquidity

d) Current ratio

Asset Management

e) Inventory (stock) turnover period

f) Trade payables’ (creditors’) turnover period

Other

g) Gearing ratio

h) Price earnings ratio

Ratio Expression 2013 2012 2013

result 2012

Result Industry

Average

Eg Trade receivables period[1]

39 days 26 days –

ROE

19%

Gross profit margin

10%

Net profit margin

3%

Current ratio

1.70

Inventory turnover period

50 days

Payables’ turnover period

20 days

Gearing ratio

4%

P/E ratio

9.0 x

Question 4

Calculate the yearly percentage change in the following items stating, in each case, whether the change is a rise or fall:

12 Marks

a) Sales

b) Operating Profit

c) Share Price

Question 5

Comment and reflect upon the ratios and percentage changes in items computed in your answers to questions 3 and 4.

30 marks

Question 6

Using the DuPont analysis technique, evaluate and comment on any changes in profitability (ROE) from 2012 to 2013. In particular, use the DuPont method to assess which aspects of the company’s performance have played a key role on the change in its profitability (if any)

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