Prepare and analyze the cash flow statement of the company (Exhibit TN-1).

EXHIBIT 1: INCOME STATEMENT, APRIL 1 TO MARCH 31 (IN ₹ THOUSANDS)

	2012–13	2013–14	2014–15
Sales Cash Credit	200 1,800	480 4,320	800 7,200
Total sales	2,000	4,800	8,000
Cost of goods sold	1,240	2,832	4,800
Gross profit
Operating expenses: General, administration, and selling expenses Depreciation Interest expenses (on borrowings)	80 100 60	450 400 158	1,000 660 340
Profit before tax (PBT)	520	960	1,200
Tax @ 30%	156	288	360
Profit after tax (PAT)	364	672	840

EXHIBIT 2: BALANCE SHEET (IN ₹ THOUSANDS)

	2012–13	2013–14	2014–15
Assets: Fixed assets (net of depreciation) Current assets Cash and cash equivalents Accounts receivable Inventories	1,900 40 300	2,500 100 1,500	4,700 106 2,100
Total	2,560	5,600	9,156
Equity & Liabilities: Equity share capital (shares of ₹10 each) Reserve & surplus Long-term borrowings Current liabilities	1,200 364 736 260	1,600 1,036 1,236 1,728	2,000 1,876 2,500 2,780
Total	2,560	5,600	9,156

EXHIBIT 3: INDUSTRY AVERAGE OF KEY RATIOS

Ratio	Sector Average
Current ratio	2.30:1
Acid test ratio (quick ratio)	1.20:1
Receivable turnover ratio	7 times
Receivable days	52 days
Inventory turnover ratio	4.85 times
Inventory days	75 days
Long-term debt to total debt	24%
Debt-to-equity ratio	35%
Gross profit ratio	40%
Net profit ratio	18%
Return on equity	22%
Return on total assets	10%
Total asset turnover ratio	1.1
Fixed asset turnover ratio	2
Current asset turnover ratio	3
Interest coverage ratio (times interest earned)	10
Working capital turnover ratio	8
Return on fixed assets	24%