1.A potential investor interested in purchasing shares in the company has approached you to undertake an analysis of the financial statements you have prepared in part 2 above.. As part of this analysis, you are required to:

a.Calculate the following ratios for both 2019 AND 2020. You are required to compare the results for the 2 years and also compare with the industry average.

b.

RATIOINDUSTRY AVERAGE

i.Return on equity8%

ii.Net profit margin7%

iii.Current ratio2:1

iv.Debt to total assets 35%

Average collection period 15 days