Lengthy Question:

Show all working done.

Conduct the liquidity analysis of the attached data through the inventory analysis: (a) inventory turnover, (b) number of days' sale in inventory.

(c) explain what the inventory analysis means for the company. (for example, in terms of liquidity)

Statement of Financial Position As at June 30, 2020 Note June 30 June 30 2020 2019 --- (Rupees in '000) ------ ASSETS Non-current asset Right-of-use asset Long-term deposits 5 6 32,644 215 32,859 616 616 Current assets 7 8 Stock-in-trade Trade debts Trade deposits Other receivables and prepayment Other financial assets Sales tax refundable Taxation - net Bank balances 9 10 511,860 193,290 13,079 139,306 478,957 58,921 19,753 14,558 1,429,724 1,462,583 326,792 156,356 9,493 81,130 557,312 27,192 25,479 5,625 1,189,379 1,189,995 11 Total assets EQUITY AND LIABILITIES Authorised capital 20,000,000 ordinary shares of Rs. 10/- each 200,000 200,000 12 Issued, subscribed and paid-up capital Unappropriated profit 192,000 590,269 782,269 192,000 449,914 641,914 Non-current liabilities Lease liabilities Staff retirement benefit - gratuity scheme 13 14 25,781 20,316 46,097 11,572 11,572 Current liabilities Trade and other payables Contract liabilities Current portion of lease liabilities Unclaimed dividend 15 16 449,186 82,943 517,012 93,775 9,661 13,769 634,217 4,380 536,509 Total equity and liabilities 1,462,583 1,189,995 Contingencies and commitments 17 The annexed notes from 1 to 35 form an integral part of these financial statements. Statement of Profit or Loss For the year ended June 30, 2020 Note June 30 June 30 2020 2019 - (Rupees in '000) Revenue from contract with customer - net 18 1,971,294 1,962,721 Cost of goods sold 19 (1,313,194) (1,310,766) Gross profit 658,100 651,955 Selling, marketing and distribution expenses 20 (287,045) (328,538) Administrative expenses 21 (47,132) (45,786) Other operating expenses 22 (26,473) (41,811) Interest expense (5,530) (7,376) Bank charges (361) (366,541) (217) (423,728) Other income 23 59,972 30,244 Profit before tax 351,531 258,471 Income tax expense 24 (129,407) (94,078) Profit for the year after tax 222,124 164,393 Rupees Earnings per share - basic and diluted 25 11.57 8.56 The annexed notes from 1 to 35 form an integral part of these financial statements. Statement of Comprehensive Income For the year ended June 30, 2020 June 30 June 30 2020 2019 ---- (Rupees in '000) Profit for the year after tax 222,124 164,393 Other comprehensive income for the year Items that may be reclassified subsequently to statement of profit or loss Items that will not be reclassified to statement of profit or loss Remeasurement of post retirement benefit obligations (14,569) 462 Total comprehensive income for the year 207,555 164,855 The annexed notes from 1 to 35 form an integral part of these financial statements