1.1 REQUIRED Use the information provided below to calculate the following ratios for 2019. Where applicable, round off answers to two decimal places. 1.1.1 Operating margin 1.1.2 Debtor collection period 1.1.3 Return on assets 1.1.4 Return on equity 1.1.5 Earnings per share 1.1.6 Acid test ratio Statement of Comprehensive Income for the year ended 31 December 2019 R Sales (all credit) 5 000 000 Cost of sales (3 000 000) Gross profit 2 000 000 Operating expenses (500 000) Operating profit 1 500 000 Interest expense (140 000) Profit before tax 1 360 000 Tax (28%) (380 800) Profit after tax 979 200 Statement of Financial Position as at 31 December 2019 R ASSETS Non-current assets 2 800 000 Inventories 800 000 Accounts receivable 600 000 Cash 170 000 4 370 000 EQUITY AND LIABILITIES Ordinary share capital (R1 each) Retained earning Long term loan Accounts payable Other current liabilities 1 200 000 1 200 000 650 000 720 000 600 000 4370 000 1.2 Discuss the four motives for holding cash