Bright Limited has the following results for the last two years of trading. Bright Limited Statement of Comprehensive Income for the Year Ended 2018 31/12/18 31/12/17 GH₵000 GH₵000 Sales 14,400 17,000 Less: Cost of sales (11,800) (12,600) Gross profit 2,600 4,400 Less expenses 1,200 2,000 Net profit for the year 1,400 2,400 Dividend paid 520 780 Retained profit for the year 880 1,620 Edwards Limited Statement of Financial Position 31/12/18 31/12/17 GH₵000 GH₵000 GH₵000 GH₵000 Non-current assets 2,500 4,000 Current assets Receivable 1,300 2,000 Cash 2,000 1,600 Inventory 2,400 5,700 820 4,420 Total assets 8,200 8,420 Financed by: Stated capital 2,400 2,400 Capital surplus 500 500 Income surplus 1,200 4,100 2,820 5,720 Non-current liabilities Non-current liability: 10% loan notes 2,600 - Current liabilities Payable 1,500 2,700 Total equity and liabilities 8,200 8,420

Required: 

(a) Calculate three profitability ratios for each year. 

(b) Calculate three liquidity ratios for each year. 

(c) Compare the profitability and liquidity ratios of the second year (2018) to the first. year (2017). 

(d) Explain three limitations inherent in ratio analysis.