Part A (4 marks)

Abbotsford Ltd and Balmain Ltd have provided the following information, which relates to the year ended 30 June 2022.

	Abbotsford Ltd	Balmain Ltd	Industry Average
Return on assets	13.31%	19.10%	15%
Current ratio	1.03:1	1.91:1	1.5:1
Debt to asset ratio	71.2%	103.4%	90.3%
Inventory turnover (days)	55 days	65 days	60 days
Receivable turnover (days)	48 days	78 days	60 days
Profit margin	12.52%	18.22%	14.75%

Required:

Using the above information, evaluate each companys liquidity and profitability. (4 marks)

Word limit 200.

Part B (4 marks)

The partial financial information of Flick Ltd is shown below:

	2021	2022
	$	$
Sales Revenue	650 000	600 200
Cost of Sales	474 500	422 000
Net Profit after tax	58 000	52 000
Cash	30 000	25 000
Account Receivable (net)	78 000	61 300
Inventory	36 400	97 500
Total Non-current Assets	370 800	440 700
Account Payable	45 000	30 000
Short-term notes payable	35 100	45 400
Total 5 year 10% Debentures	125 900	110 600
Share Capital	224 200	340 000
General Reserve	0	10 000
Retained Earnings	85 000	66 000

Required:

Using the above information, you are required to calculate the following financial ratios. (4 marks)

1. Profit margin for 2021_________

2. Current ratio for 2022_________

3. Return on ordinary shares equity for 2022_________

4. Debt to assets for 2022_________