Calculate the following ratios, to one decimal place, for the two companies: i. Return on Capital Employed. ii. Gross Profit Margin. iii. Quick ratio. iv. Receivables collection period. v. Inventory holding period. vi. Payables payment period. (12 marks) (b) Compare and contrast the ratios in (a), discuss why there might be significant differences between the two companies performance. Highlight any limitations of this type of ratio analysis.

Bailes Ltd and Dailey Ltd are two companies operating in the same sector. Their recent financial statements are as follows