Question $4$

$(15$ Marks$)$

Bostar Stationers main line of business is the sale of books and stationery. The following information

of the business' financial statements is provided to you.

Statement of Comprehensive and Other Income for the year ended $30$ November $2021$:

Items extracted from the statements of financial position of Bostar Stationers:

$*$This amount includes inventory valued at R$21800.$

$5\mathrm{.}1$ Explain why ratios analysis is important for business organisations Bostar Stationers.

$5\mathrm{.}2$ Calculate the following ratios for the year ended $30$ November $2019,$ and in each case state

whether the ratio means to the business. Express answers to two decimal places.

$5\mathrm{.}2\mathrm{.}1$ Net profit margin

$5\mathrm{.}2\mathrm{.}2$ Return on assets

$5\mathrm{.}2\mathrm{.}3$ Acid test ratio

NB: Write the formula first for each ratio. Marks are awarded for the formula