Please assist with question 2

QUESTION 2 (20 Marks) REQUIRED Use the information provided in QUESTION 1 to answer the following questions: 2.1 Calculate the ratios for 2021 (expressed to two decimal places) that reflect each of the following: 2.1.1 A measure of profitability by comparing the net income and the sales of the company. 2.1.2 The amount of time it takes for clients to settle their debts. 2.1.3 The efficiency of the company in using its own and borrowed capital to generate profits. 2.1.4 A measure of the ability of the company to generate profits from its shareholders investments in the company. 2.1.5 A comparison of the company's short-term assets except inventories to its short-term liabilities to see if the company will have enough cash to pay its immediate liabilities. 2.1.6 The percentage of the company's long-term debt to its shareholder's equity. (2) (2) (2) (2) (2) (2) ) (2) 2.2 Refer to your answers in question 2.1 and answer the following questions: 2.2.1 Comment on the liquidity of the company. 2.2.2 Would it be prudent to finance an expansion programme by increasing the borrowed capital? Motivate your answer with the use of TWO (2) relevant ratios. 2.2.3 Comment on the return earned by shareholders on their investment in the company. (4) (2) (2) (2) (2) REQUIRED Use the information provided below to answer the following questions: 1.1 Provide a possible reason why the amount for interest expense in the Statement of Comprehensive Income is zero. 1.2 Calculate the depreciation for the year ended 31 December 2021. 1.3 Calculate the amount that would appear in the cash flow statement for the year ended 31 December 2021 for Profit before working capital changes. Suggest FOUR (4) control measures that you would put in place to reduce the chances of embezzlement of cash by the employees. 1.5 What will be the impact on the value of inventory (in the Statement of Financial Position) and the cost of goods sold (in the Statement of Comprehensive Income) if the last-in-first-out (LIFO) method rather than the first-in-first-out (FIFO) method is used during periods of inflation? 1.6 Explain THREE (3) implications of a high earnings retention ratio to the shareholders of Mobifone Limited. 1.4 (4) (4) (6) INFORMATION The following information was extracted from the accounting records of Mobifone Limited on 31 December 2021, the end of the financial year: MOBIFONE LIMITED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2021 R ASSETS Non-current assets 1 700 000 1 500 000 Fixed/Tangible assets Investments 200 000 Current assets 5 300 000 3 400 000 Inventories Accounts receivable 1 600 000 Cash 300 000 Total assets 7 000 000 3 200 000 2 300 000 900 000 EQUITY AND LIABILITIES Equity Share capital Retained earnings Non-current liabilities Loan: KLM Bank (15%) Current liabilities Accounts payable Total equity and liabilities 1 600 000 1 600 000 2 200 000 2 200 000 7 000 000 MOBIFONE LIMITED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2021 R 17 000 000 (14 000 000) 3 000 000 ? Sales (all credit) Cost of sales Gross profit Operating expenses Depreciation Other selling, general and administrative expenses Operating profit Investment income ? 1 400 000 1 000 000 20 000 Interest expense 0 Profit before tax 1 020 000 (285 600) Company tax Profit after tax 734 400