Armstrong Scenic Adventures and Blair's Tropical Discoveries are tour operators based in Cairns in far north Queensland. They both run land and sea adventure tours and passenger services. You are an analyst employed by the Bank of Palm Cove. Both businesses are seeking additional funds from the Bank of Palm Cove to finance a business expansion. Both Armstrong and Blair are direct competitors and the Bank of Palm Cove is only in a financial position to fund one but not both of the businesses. Your analysis will be a cornerstone in the decision made by the Bank of Palm Cove. Apart from the financial information provided, additional information needs to be considered. 1.The cost of debt (interest rates) at the moment is 2.5% 2.Blair's PPE is relatively new and Blair is also investigating the purchase of a new all-terrain vehicle that has the capacity of 50 passengers which will accommodate them in total comfort especially for the over 50 year age group. 3. The Australian dollar (AUD) to the US dollar ($US) is 0.70. This is very favourable for international tourists. 4. A new hotel is being built on Green Island and another island is being commercially redeveloped for tourism. 5. The cost of fuel is at its lowest level in seven (7) years. 6. Armstrong's is in a pay dispute with its drivers which has lasted three weeks with a threat of strike action. 7. There has been an increase in Australians travelling to far north Queensland instead of overseas due to the unfavourable exchange rate. Specific Details: Service Revenue Net Profit Average Total Assets Average PPE Total Liabilities Cash Flow from Operating Activities Asset turnover Armstrong Scenic Adventures Blair's Tropical Discoveries $ 450,000 60,000 500,000 250,000 160,000 Armstrong Scenic Adventures Return on Assets Net Profit/ Average Total Assets Prove ROA 200,000 Gearing 1. Calculate the following ratios that will form part of the basis of your report. Net profit margin Net Profit/ Service Revenue $ 1,000,000 90,000 Asset T/Ox NP Margin 800,000 600,000 140,000 Total Liabilities/Total Assets. 500,000 Service Revenue / A. Total Assets Service Revenue / A. Total Assets Blair's Tropical Discoveries Net Profit / Average Total Assets Net Profit/ Service Revenue Asset T/O NP Margin Total Liabilities/Total Assets Quality of Income Cash Flow Operating Activity. /NP Cash Flow Operating Activity. /NP