REQUIRED Use the information provided below to answer the following questions. Note: Use the formulas provided in the formula sheet only (that appear after QUESTION 5). Answers to the ratios must be expressed to two decimal places. 4.1 What percentage of the sales is made up of net income? (2 marks) 4.2 Calculate TWO (2) appropriate liquidity ratios and comment on the liquidity of the company. (6 marks) 4.3 Calculate the relevant ratios and comment on the effectiveness with which the company has employed the debtors and creditors. (6 marks) 4.4 Calculate TWO (2) appropriate ratios that would be used to assess the profitability of the company by examining the income from operations and the after-tax returns earned. Comment on your calculations. (6 marks) INFORMATION Excerpts of financial data of Markram Limited for 2022 are as follows: Statement of Comprehensive Income for the year ended 31 December 2022 Sales Cost of sales Opening inventory Purchases Closing inventory R 6 000 000 4 000 000 200 000 ? 500 000 Operating profit Interest expense Profit before tax Company tax 1 200 000 200 000 1 000 000 270 000 Statement of Financial Position as at 31 December 2022 Non-current assets Inventories Accounts receivable Cash Bank overdraft Ordinary share capital Retained earnings Long-term loan Accounts payable Additional information Ninety percent (90%) of the sales is on credit. All purchases are on credit. Credit terms to debtors are 60 days and credit terms from suppliers are 90 days. R 3 500 000 500 000 1 400 000 2000 30 000 940 000 132 000 3 600 000 700 000 Gross profit X 100 Sales 1 Profit after tax X 100 Sales 1 Cost of sales Average inventory FORMULA SHEET Profit after tax No. of ordinary shares issued X 100 1 Dividends for the year X 100 No. of ordinary shares issued 1 Current assets Current liabilities Accounts receivable X 365 Current assets Inventory Credit sales 1 Current liabilities Accounts payable X 365 Total debt X 100 Credit purchases 1 Total assets 1 Operating profit X 100 Non-current debt X 100 Total assets 1 Equity 1 Profit after tax X 100 Operating profit Equity 1 Interest expense