5 MID-SEMESTER (PART TWO) (a) From YOUR COPY of the Profit or Loss Statement and the Statement of Financial Position of Glory Company for the year ended 2019, calculate the following ratios: (i) Net Profit Margin; Current Ratio; (iii) Acid Test Ratio; (iv) Debtors Collection Period (in days); (v) Creditors Payment Period (in days); and (vi) Inventory (Stock) Turnover. I (b) In the table labelled "TABLE A below, ratios of Praise Company for the same period, have been provided. Put the values you obtained from calculating the ratios for Glory Company in their correct spaces. "TABLE A S/No. Ratios Praise Company Glory Company Net Profit Margin 53.0% 2 Current Ratio 3:1 3 Acid Test (Quick) Ratio 6:1 4 Debtors Collection Period 4 Days 5 Creditors Payment Period 280 Days 6 Inventory (Stock) Turnover 8 Times 1 (c) Compare the ratios of Glory Company with those provided for Praise Company in TABLE A" and for each of them, state which company did better and, briefly explain why. GLORY COMPANY STATEMENT OF FINANCIAL POSITION GHc Ghc 370 700 105 75 Non-Current Assets: Machinery 1,120 Building 3,180 Current Assets: Cash Bank Debtors (Accounts Receivable) Stock (Inventory) 1.250 Total Assets 5,550 Less Current Liabilities: Bank Overdraft Creditors (Accounts Payable) 1.050 Net Assets 4,500 Financed by: Opening Capital (1-1-2019) Add: Net Profit 950 100 5,300 1.700 7,000 2.500 Less: Drawings Closing Capital (31-12-2019) 4,500 GLORY COMPANY STATEMENT OF PROFIT OR LOSS GHc GHC Sales 3,500 Less Cost of Sales: Opening Stock (Inventory) Add: Cash Purchases Credit Purchases Carriage Inwards 275 325 120 180 900 150 Less: Closing Stock (Inventory) 750 Gross Profit 2,750 Less: Expenses Office Expenses Selling and Distribution Advertising Warehousing lighting 1,050 Net Profit 1,700 262.5 262.5 262.5 262.5