From the following information extracted from the Balance Sheet of XYZ Company, you are required to calculate:
a. Leverage ratios for 2018 and 2019. (4 marks)
b. Using your results from (a), comment on the solvency of the company. (1 mark)
Particulars
2018
OMR
2019
OMR
Cash and bank balances
10,500
12,900
Property, plant and equipment
760,000
700,000
Short – term bank borrowings
50,000
55,000
Trade and other receivables
31,950
30,088
8% Debentures
800,000
800,000
Inventories
28,900
28,400
Vehicles
150,000
130,000
Share capital
2,500,000
2,500,000
Trade and other payable
14,100
18,300
10 years bank loan
500,000
480,000
