1.1 Use the financial information provided to calculate the following ratios for the year ending 31 December 2018:

1. Current ratio; (2)
2. Acid test ratio; (2)
3. Debtors collection period (in days); (2)
4. Creditors payment period (in days); (2)
5. Inventory turnover rate (times per year); (2)
6. Gross profit percentage; (2)
7. Net profit percentage; (2)
8. Return on equity; and (2)
1. Debt equity ratio. (2)

1.2 As CFO of Wool-on Ltd you have to compile a report about the financial position of Catwalksale which will be delivered to the board. Use the ratios calculated in 1.1 to compare with the previous years ratios. Suggest areas of strengths and weaknesses and make recommendations to the board whether they should provide the loan to Catwalksale (Pty) Ltd - or any other alternatives available. (15)