Ruskin Limited manufactures and sells microwave ovens. The business has grown steadily over the past four years and is now in the position to compete with the big brands in the market. The director of the company attributes this success to the cost efficient structure of the business and effective marketing strategies. The director wants to assess company performance and position over the past two year using financial ratios.
The income statement and balance sheet of the company are as follows:
Ruskin Limited income statement for the year ended
2014 2013
£000 £000
Sales 1080 720
less: Cost of Sales 360 225
Gross Profit 720 495
Less: Operating Expenses 405 270
Operating Profit 315 225
less: Interest 45 22.5
Profit after Interest 270 202.5
less: Taxation 36 40.5
Profit after Tax 234 162

Ruskin Ltd. Balance sheets as at 31 December

2014
£ 000 2013
£ 000

Non-Current Assets
Property, plant & equipment 1350 810

Current assets
Inventory 225 157.5
Trade Receivables 67.5 25.2
Cash 29.7 322.2 14.4 197.1
Total Assets 1672.2 1007.1

Equity and Liabilities
Equity 1080 765
Profit for the Period 234 162

Non-Current Liabilities
Loan 225 22.5

Current Liabilities
Trade Payables 108 45
Interest payable 25.2 12.6
Total Equity and Liabilities 1672.2 1007.1

1.) Calculate all the possible ratio.
2.) Comment briefly on the financial performance of the Ruskin Ltd.