1. Current Asset Management Consider these two firms. They are competitors in the same industry. The current balance sheets for each firm, sales and net profit figures are: 480 GREYWACKE Ltd Balance Sheet (All figures except percentages in 00s) Marketable Securities Accounts Payable Receivables 848 Notes Payable Inventory 816 Total Current Liabilities Total Current Assets 2144 Noncurrent Debt Net Fixed Asets 1248 Equity Total Assets 3392 Total Liabilities and Equity 560 144 704 528 2160 3392 GREY WACKE Ltd other information 1000 Sales NPAT 144 480 544 1024 SCHIST Ltd Balance Sheet (All figures except percentages in 000s) Receivables 720 Accounts Payable Inventory 592 Notes Payable Total Current Assets 1312 Total Current Liabilities Noncurrent Debt Net Fixed Asets 1648 Equity Total Assets 2960 Total Liabilities and Equity SCHIST Ltd other information Sales 1024 NPAT 128 240 1696 2960 Required: (a) In the above data, it is not possible to put exact figures on TCA and PCA. Please define these two terms. (2 marks) (b) Using any ratios you consider relevant, identify, compare and contrast the asset management policies of the two companies, including their financing and their impacts on profitability. (6 marks for ratios + 6 marks for commentary = 12 marks) (c) Comment on what would happen if Greywacke Ltd was to sell all of its marketable securities and pay the proceeds out as a dividend. Please use appropriate ratio analysis to back up your comments. (6 marks) TOTAL: 20 Marks