Financial Ratios, Discriminant Analysis and the Prediction of Corporate Bankruptcy

Financial Ratios, Discriminant Analysis and the Prediction of Corporate Bankruptcy Essay example
Undergraduate
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Finance & Accounting
Pages 9 (2259 words)
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Banking  Table of Contents Question 1 3 Question 1 (a) 3 Question 1 (b) 5 Question 2 11 Question 3 12 Question 4 13 Question 4 (a) 13 Question 4 (b) 13 Question 5 14 References 16 Bibliography 17 Appendices 18 Loan Amortization Schedule 18 Question 1 Question 1 (a) The Gross Income Margin is a financial measure to evaluate an organization’s financial wellbeing by disclosing the percentage of cash left after considering the cost of goods sold into account…

Introduction

The cost of sales value includes the cost of resources utilized in the manufacturing of the products along with the labor expenses utilized in the production of the products. Thus, the cost of sales can be computed as, Cost of Sales = Opening Stock + Purchases – Closing Stock The computation of the cost of sales of a company does not comprise of any indirect costs involved in the process of sale of the products. Thus, the repair and maintenance charges, costs of depreciation of tools and equipments, rent expenditure, wages and charges of water and electricity have been excluded from the calculation of the cost of sales and hence from the computation of the gross profit of the company1. ...
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