3. The summarized financial statements of Baraka enterprises ltd are As follows Income statement for the yare ended 30 September 2003 2004 Sh 000 sh000 Sales 20,000 28,000 Cost of sales (15,000) (21,000) Gross profit 5,000 7,000 Administrative expenses 3,800 4,600 Debenture interest - (400) Net profit 1,200 2,000 Balance sheet as at 30 September Sh000 sh000 Non-current assets Plant, properties and equipment (NBV) 11,000 14,000 Current assets Inventories 2,000 3,000 Trade and other receivables 2,500 2,800 Balance at bank - 500 4,500 6,300 Total assets 15,500 20,300 Equity and liabilities Issued and fully paid 1,000,000 ordinary shares of sh 10 each 10,000 10,000 Revenue reserves 3,000 4,100 Noncurrent liabilities 8% debentures - 5,000 Current liabilities Trade and other payable 1,500 1,200 Bank overdraft 1,000 - Stock as at 1 October 2002 was shs 5,000,000 Required: a) for each year calculate the following a) Gross profit margin. (2 Marks) b) Inventory turnover. (2 Marks) c) Return on equity. (2 Marks) d) Return on assets. (2 Marks) e) Acid test ratio. (2 Marks) f) Current ratio. (2 Marks) g) Financial leverage. (3 Marks) b) Comment on the liquid position of the company giving possible reasons for the changes.