Ratios calculated from the financial statements of ST Group for the years ended 31 August 20X7...

CIMA F2 Question Answer

Ratios calculated from the financial statements of ST Group for the years ended 31 August 20X7 and 20X6 are as follows:

Which of the following would have contributed to the movements in these ratios?

During 20X7 ST Group acquired an associate which made a relatively small profit for the year.

ST Group extended its customer base which resulted in an increase in the volume of sales during 20X7.

During 20X7 ST Group increased the useful life of its vehicles to five years from four and adjusted the depreciation charge accordingly.

The fair value of an investment acquired in 20X7 and classified as fair value through profit or loss has increased in value by the year end.

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