The financial statements for Harridges Ltd are given below for the two years ended 30 June 2014 and 2015. Harridges Limited operates a store in the centre of a small town.

Dividends were paid on ordinary shares of £65,000 and £75,000 in respect of 2014 and 2015, respectively.
Required:

(a) Choose and calculate eight ratios that would be helpful in assessing the performance of Harridges Ltd. Use end-of-year values and calculate ratios for both 2014 and 2015.

(b) Using the ratios calculated in

(a) and any others you consider helpful, comment on the business’s performance from the viewpoint of a prospective purchaser of a majority of shares.

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Income statements for the years ended 30 June Sales revenue Cost of sales Gross profit Wages and salaries Overheads 2014 2015 000 000 2,600 3,500 (1,560) (2,350) 1,040 1,150 (320) (350) (260) (200) (150) (250) 310 350 Depreciation Operating profit Interest payable (50) Profit before taxation 260 Taxation (105) Profit for the year 155 _ (50) 300 (125) 175