2. (b) Using the above industry averages, analyse and comment on the companys profitability, liquidity and use of financial gearing for 2017.

   (12 marks)

3. (c) Describe a key precaution that needs to be taken when making comparison with the industrial average.

   (3 marks)

Ratio Industry Average Tampines Ltd i) Return on Total Assets 12% 27% ii) Return on ordinary shareholders' equit 20% 60% iii) Profit margin ratio 8% 4% 5% 2.5:1 v) Dividend vield 2% v) Current ratio 2.21:1 vi) Acid test ratio vii) Days' sales uncollected viii) Inventory Turnover 1.3:1 0.99:1 27.21 days 28.1 days 6 5.04 47% ix) Equity ratio 60% 6 5.02 X imes Interest earned (b)Using the above industry averages, analyse and comment on the company's profitability, liquidity and use of financial gearing for 2017. (12 marks) (c) Describe a key precaution that needs to be taken when making comparison with the industrial average