JESTION 3 e following data was obtained from the books of DURBY Ltd and SLATE LTD who are both in the business of selling equipment. ndensed Income statement for the year ended Dec 31, 2020 SLATE $ Gross Profit Net profit before tax Tax DURBY LTD $ $ 450,000 264,000 42.000 222,000 $ 410,000 246,200 550,000 191,200 Dividends: ordinary preference 12,000 15,000 16,000 24,000 Transfer to reserves Profit for the year Market Price per share -27,000 -15,000 180,000 1.50 -40,000 -24,000 127.200 2.20 780,000 865,000 Balance Sheets as at December 31, 2020 Non-current Assets Tangible Assets Current Assets Stock 39,000 Short Term Investments 2,500 Debtors 13,600 Bank 20,000 Cash 1,900 Total Assets Equity and Liabilities Capital and Reserves 54,000 15,000 8,600 42,000 6,300 77,000 857,000 125.900 990,900 Ordinary Shares @1.00 Preference Shares@0.50 General Reserves Retained Earnings 300,000 24,000 64,000 180,000 250,000 35,000 58,000 233.200 568,000 576,200 200,000 330,000 Non-Current liabilities 10%debenture Current liabilities creditors Tax payable Dividends payable 14,000 35,000 40,000 22,700 30,000 32,000 89,000 857.000 84,700 990,900 Required a. Calculate the following ratios for EACH company 1) Current ratio 2) Gearing ratio 3) Return on shareholder's equity Each @ 2 marks = (6 marks) b. Compare and comment on the performance of each company in relation to the industry averages given below: Industry Averages 1.2:1 Ratios 1) Current ratio 2) Gearing ratio 3) Return on shareholder's equity 33% 44% Each @ 4 marks = (12 marks) =