The following extracts are taken from the financial statements of Marsh Ltd and Mallow Ltd. Marsh Ltd

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The following extracts are taken from the financial statements of Marsh Ltd and Mallow Ltd.

Marsh Ltd Mallow Ltd

£ £

Capital employed 281,000 596,000 Operating profit 29,500 41,500 Gross profit 71,400 156,200 Revenue 354,900 706,260 Required

(a) Calculate the main profitability ratios for both companies.

(b) Suggest reasons for any differences you find.

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