Balance Sheets
Asd at 30th June 20X2 and 20X3
	20X3 $000s	20X2$000s
Current asset
Cash at bank	14500	12451
Marketable security		1000
Accounts receivables	21750	23675
Inventories	24625	18454
Prepayments	10458	8475
Total Current Asset	71333	64055
Non Current Asset
Property ,Plant & equipment (net)	45000	39850
Building (net)	20532	22400
Intangible and other assets	25120	21863
Total Non Current asset	90652	841134
Total assets	161985	148168
Liabilities and shareholders Equity
Current Liabilities
Account payable trade	28450	22642
Short term loan payable	20000	20000
Accrued Liabilities	5600	3800
Total Current Liabilities	54050	46442
Non current Liabilities
Long term Borrowings	42750	46210
Other Long term debts	15862	25644
Total non current Liabilities	58612	71854
Total Liabilities	112662	118296
Net asset	49323	29872
Equity
Issued Capital	35000	20000
Retained Earnings	14323	9872
Total Equity	49323	29872
Statement of profit and loss
For the year ending 30th June ,20x2and 20x3
	20X3 $000s	20X2 $000s
Net sales	115750	119564
Cost of goods sold	65750	61257
Gross profit	50000	58307
Less expenses
Selling and administrative expenses	20816	23475
Interest expenses	5902	5771
Total	26718	29246
Operating profit before income tax	23282	29061
Income Tax expense	7810	8251
Operating Profit after tax	15472	20810

Comparative Ratios
	20X3	Industry Average	20X2
Current Ratio		1.89
Quick Asset Ratio		.80
Inventory Turnover		120 days	130 days
Days in Debtors		60 days	64.1 days
Debt Ratio		0.6
Times Interest Earned		4.5
Gross Profit Margin		45.6%
Profit Margin		12.55%
Return on Assets (ROA)		0.19	0.21
Return on Ordinary Equity (ROE)		0.251	0.61

1. Calculate the ratios missing above for 20X3 and 20X2; 8marks

2. Write a report indicating your thoughts as a manager commenting on what the ratios are revealing in terms of trends in the business and by comparison to the industry;

3. Some of the departmental managers are concerned that the trend in sales and both the profit margins is not as good as could be. They are pushing to move to more online sales thinking that will lead to a reduction in wages and other costs. After consulting the website of one of the biggest competitors Woolworths Ltd advise

   (i) what % of sales do Woolworths complete online? 1 mark

(i) whether you think that a move to online is the right approach for Cost Less and two reasons why or why not? 3 marks