1. Calculate the following ratios (to 1 decimal place) of Rhubarb Limited for the years ending 31 December 2021 and 2022:

1. Return on investment.
2. Return on capital employed.
3. Gross profit percentage or gross profit margin.
4. Net profit percentage or net profit margin.
5. Current ratio.
6. Acid test.
7. Inventory turnover.
8. Trade receivables collection period.
9. Trade payables payment period.
10. 
    

FINANCIAL STATEMENTS OF RHUBARB LIMITED Income Statements	2021	2022
000	000
Sales	16,850	28,000
Cost of sales	(10,900)	(19,500)
Gross profit	5,950	8,500
Distribution costs	(1,690)	(1,900)
Administrative expense	(2,830)	(3,400)
Profit before interest and tax	1,430	3,200
Interest	(300)	(700)
Profit before tax	1,130	2,500
Tax	(270)	(600)
Profit after tax	860	1,900

Statements of financial position	2021	2022
000	000
Non-current assets	12,800	18,000
Current assets
Inventories	2,900	4,200
Trade receivables	2,400	5,400
Prepayments	300	500
Bank	300	0
5,900	10,100
Total assets	18,700	28,100
Equity
1 ordinary shares	5,000	8,000
Share premium	4,000	6,000
General reserve	2,300	2,400
Accumulated profit	1,600	600
12,900	17,000
Non-current liabilities
10% loan	3,000	7,000
Current liabilities
Trade payables	1,000	1,400
Accruals	1,800	1,900
Bank Overdraft	0	800
2,800	4,100
Total equity and liabilities	18,700	28,100

You are employed in a management role by Rhubarb Ltd. The company is considering offering bonuses to employees in the form of shares in the company. The employees recently attended a seminar on the understanding of financial statements. It included a presentation on ratio analysis. The feedback on the seminar provided by the employees was positive, but many did state afterwards that they are still having issues understanding the subject matter.

Copies of the two most recent financial statements of Rhubarb Limited were given to the employees.

1.