4.1.1 Gross margin (2 marks) 4.1.2 Inventory turnover (2 marks) The extracts of the financial statements of Ashton Limited for 2019 and 2020 are provided below. Ashton Limited Statement of Comprehensive Income for the year ended 31 December 2020 Cost of sales Operating profit Profit before tax R 1 200 000 440 000 380 000 Note: Goods were sold at cost plus 60%. The tax rate is 28%. Statement of Financial Position as at 31 December: 2020 2019 R R ? 1 940 000 ? 400 000 Non-current assets Inventories Accounts receivable Cash and cash equivalents 600 000 440 000 400 000 320 000 2 3 260 000 2 920 000 Equity Non-current liabilities: Loan from Fed Bank Accounts payable ? 2 660 000 220 000 380 000 360 000 ? 3 260 000 Additional information Non-current assets comprised equipment as well as land and buildings. Depreciation for the year ended 31 December 2020 amounted to R200 000. Extensions to the buildings during 2020 amounted to R520 000 Inventories on 31 December 2020 represented 37.5% of sales. Loan repayments to Fed Bank during 2020 amounted to R50 000. An additional R370 000 was borrowed from Fed Bank on 01 July 2020. All sales and purchases are on credit Credit terms to debtors are 30 days. 1