Task $4-$ due by Tuesday $28/01/25$

Sharma and Ryan now want you to help them understand their final accounts for SIGNature Ltd$.$ You need to prepare a set of appendices to the accounts which explain their profitability, liquidity and efficiency. Your explanation should be entirely honest as only Sharma and Ryan will see the comments you make. Before you make your comments you will firstly need to produce the following $\backslash (\{\}^\{\backslash$text $\{\}\}\backslash )$

$1.$ Profitability

Gross profit $\backslash \%$ of sales

Net profit $\backslash \%$ of sales

ROCE

$2.$ Liquidity

Current ratio

Acid test$/$liquidity ratio

$3.$ Efficiency

Debtors payment period

Creditors payment period

Rate of stock turnover

You are to explain what each ratio a measurement is of and what the result means to Sharma and Ryan.

Explain the possible reasons for the ratio and the significance of it to the business's overall financial performance. Explain whether the ratio's show a good or poor performance and then write a conclusion summarising the overall performance of Sharma and Ryan's first year of trading.