Evaluate the usefulness of financial ratio analysis in assessing the financial state of an enterprise. Use the case below to illustrate your answer.

Case A summary of the results of Sandygate Enterprises Limited for the last three years is as follows:

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Year ended 31 December 20X0 20X1 20X2 Sales 480,000 560,000 690,000 Profits before tax 63,000 70,000 74,000 Tax 23,000 25,000 28,000 Profits after tax 40,000 45,000 46,000 Dividends 30,000 30,000 36,000 Retained profit for year 10,000 15,000 10,000 Share capital (600,000 0.25 shares) 150,000 150,000 150,000 Retained profit 85,000 100,000 110,000 Shareholders' funds 235,000 250,000 260,000 10% debentures 65,000 150,000 150,000 Capital employed 300,000 400,000 410,000 Market price per share at 31 December 1 1.50 1.25 Debt interest 6,500 15,000 15,000