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We also refers to the slides show that provided by our lecturer in doing the calculation and make conclusion. The purpose of we doing this assignment is because of we want to know the financial status of Oriental Food Industries Holding Bad company for three years which are 2011, 2012, and 2013. Through the financial status of Oriental Food Industries Holding Bad company, we can predict the investor whether will invest or not to invest in this company. COMPANY PROFILE Oriental Food Industries Holding Bad was established and incorporated in 978.
From their modest beginnings, they have made their mark in the food manufacturing industry today holding the leading position in the snack food and confectionery industry in Malaysia. This company is in a crowded marketplace, they remain focused on placing the needs and interests of our customers’ first by manufacturing products that focuses on quality. Generally their products can be divided into four broad categories, which are snack food, wafer, potato snacks and bakery products. This company located in Air Kerri Industrial
Estate in Malaria, which is well recognized as Malice’s industrial hub, covering approximately 15 acre of prime industrial property. Methodology 1. LIQUIDITY RATIO a. Current ratio- compares cash and current assets that should be converted into cash during the year with the liabilities that should be paid within the year. Formula : Current ratio = current assets / current liabilities = times Year 2011 2012 2013 (ARM) Cue rent Asset 62,352,222 73, 133,786 171,723,113 Current Liability Calculation Current Ratio b.
Quick ratio – compares cash and current assets ( minus inventory ) that should e converted into cash during the year with the liabilities that should be paid within the year. Formula : Quick ratio = (Current assets – inventory) / Current liability = X Year 21,083,590 Inventory 15, 122,535 19,274,047 17,350,966 Quick Ratio 2. ASSET MANAGEMENT RATIOS a. Average collection period – determines the average days for the firm to collect its accounts receivable from customers in certain period. Formula : CAP = Accounts receivable / (Annual credit sales /365) = Days Year Accounts Receivable 25,624,425 31,762,235 Annual Credit Sale CAP b.
Accounts receivable turnover – determines the ability of the business to collect debt from its customers. It shows the number of account receivable turn in a year. A turn covers the starting period of account receivable until the due of the of the cacao NT. Formula : ART = Credit sales / Accounts receivable = times Year Credit Sale ART c. Inventory turnover – shows how many times per year the inventory will be sold and replaced. Formula : Inventory turnover = cost of goods sold / inventory = times Year Cost Of Goods Sold 166,429,312 Inventory Turnover .
Total assets turnover – shows the efficiency of the firm to use its assets to generate sales. Total asset turnover = sales / total assets = times 149,294,765 195,269,469 Total assets 145,099,665 Total asset turnover e. Fixed asset turnover – shows the efficiency of the firm in using fixed assets in generating sales. Fixed asset turnover = sales / total fixed assets = times Year 201 1 Total fixed asset 82,747,443 86, 132,300 Fixed asset turnover 3. LEVERAGE RATIOS a. Debt ratio – shows the percentage of firm’s assets that financed by debt 9 implying the balance is financed by equity).
Debt ratio = total debt / total assets = % Total debt 28,297,497 Total asset Debt ratio b. Debt equity ratio -measure the percentage of liability covers by equity . Debt to equity ratio = total debt / total equity = % Total Debt 38,310,903 Total Equity DOE c. Time interest earned (TIE) – measures how many times the firm has profit to pay interest expenses. This ratio indicates the amount of operating income available to service interest payments. TIE ?BIT / Interest expense = times BIT interest expense TIE 4. PROBABILITY RATIOS .