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5 marksFinancial Statements Analysis

CAPE Management of Business Unit 1 · 2011 · Paper 2 · Question 5(a)(ii)

Multi-link Inc. published financial figures for capital employed, net profit, gross profit, and sales turnover for 2009 and 2010.

Calculate the net profit margin for 2009 and 2010, and use your results to assess the performance of the company over the two-year period.

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Other parts of this question

  1. 5(a)(i)Calculate the gross profit margin for 2009 and 2010, and use your results to assess the performance of the company over the two-year period.[5 marks]
  2. 5(a)(iii)Calculate the return on capital employed for 2009 and 2010, and use your results to assess the performance of the company over the two-year period.[5 marks]
  3. 5(b)Explain TWO limitations of using accounting ratios to assess the performance of a firm and suggest how EACH limitation may be overcome.[10 marks]

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