A The following are the financial statements of D Limited, a wholesaling company, for the year ended 31 December:

The following information should be taken into consideration.
1 You may assume that:
(i) The range of products sold by D Limited remained unchanged over the two years;
(ii) the company managed to acquire its products in \(19 \mathrm{X} 5\) at the same prices as it acquired them for in \(19 \times 4\);
(iii) the effects of any inflationary aspects have been taken into account in the figures.
2 Ignore taxation.
3 All calculations must be shown to one decimal place.
You are required, using the information above, to assess and comment briffly on the company, from the point of view of:

(a) profitability;

(b) liquidity.

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Gross profit Distribution costs Administration expenses Operating profit Interest payable Profit on ordinary activities before tax Profit and Loss Accounts 19X4 19X4 19X5 19X5 000 000 000 000 Turnover-credit sales cash sales 2,200 2,640 200 160 2,400 2,800 Cost of sales (1,872) (2,212) 528 588 (278) (300) (112) (114) 138 174 (32) 138 142 Balance Sheets as at 31 December 19X4 19X4 19X5 19X5 000 000 000 000 Tangible fixed assets 220 286 Current assets: Stocks 544 660 Debtors 384 644 Cash at bank 8 110 936 1,414