QUESTION $5$

REQUIRED

Use the information provided in Question $4$ to answer the following questions:

$5\mathrm{.}1$ Calculate the following ratios $($expressed to two decimal places$)$ for $2023$ only. Note: Use the

formulas provided in the formula sheet only $($that appear after QUESTION $5).$

$5\mathrm{.}1\mathrm{.}1$ Gross margin

$5\mathrm{.}1\mathrm{.}2$ Debtor collection period

$5\mathrm{.}1\mathrm{.}3$ Inventory turnover

$5\mathrm{.}1\mathrm{.}4$ Earnings per share

$5\mathrm{.}1\mathrm{.}5$ Current ratio

$5\mathrm{.}1\mathrm{.}6$ Debt to assets

$5\mathrm{.}1\mathrm{.}7$ Return on equity

$5\mathrm{.}2$ Comment on the return on equity calculated above. $($Note: The return on equity

for $2022$ was $18\mathrm{.}12\%.)$

$5\mathrm{.}3$ Refer to the appropriate ratio in question $5\mathrm{.}1$ and explain whether the company

will be able to easily pay its short$-$term debts or not.

END OF PAPER

FORMULA SHEET

$\begin{array}{cc}\text{C}\text{u}\text{r}\text{r}\text{e}\text{n}\text{t}\text{a}\text{s}\text{s}\text{e}\text{t}\text{s}& \text{C}\text{u}\text{r}\text{r}\text{e}\text{n}\text{t}\text{l}\text{i}\text{a}\text{b}\text{i}\text{l}\text{i}\text{t}\text{i}\text{e}\text{s}\end{array}$

$\begin{array}{cc}\text{C}\text{o}\text{s}\text{t}of\text{s}\text{a}\text{l}\text{e}\text{s}& \text{A}\text{v}\text{e}\text{r}\text{a}\text{g}\text{e}\text{i}\text{n}\text{v}\text{e}\text{n}\text{t}\text{o}\text{r}\text{y}\end{array}$