c) What are the qualities of useful financial statements? (6 Marks) d) The following information is provided for Muita Ltd Plant Building Ratio Analysis 2009 Cost Deprec. Net Book Cost 2010 Deprec. Value Net Book Value Sh.'000' Sh.'000' Sh.'000' Sh.'000' Sh,'000' Sh.'000' 200 80 120 220 100 120 1,000 200 800 1,800 220 1,580 920 1,700 2 L L Investments at Cost 1,000 1,600 Land 860 1,260 Stock 1,100 1,300 Debtors 800 1,000 Bank 60 4,740 6,860 Ordinary shares at Sh.20 800 1,000 each 240 280 Share premium 400 Revaluation Reserve 500 500 Profit and Loss Account 2,000 3,000 10% Debentures 800 1,200 Creditors 400 400 Proposed Dividends _80 Bank 4,740 6,860 Profit & Loss Account 4,000 4,000 Sales 2,000 2,400 Cost of Sales 2,000 1,600 1,200 1,200 Expenses 800 400 Dividends 400 400 400 Balance b/f 100 500 Balance c/f 500 500 Required: Calculate for Mvita Ltd. for 2009 and 2010 the following ratios: a. Return on capital employed; b. Debtors turnover; c. Creditors turnover; d. Current ratio; e. Quick assets (acid test) ratio; f. Gross profit ratio 9. Net profit percentage h. Dividend cover i. Gearing ratio, Using the summarized accounts given and ratios you have just prepared, comment on the financial position and prospects of Muita Ltd. (Total: 25 Marks)