Part A Bitmap plc is well established manufacturer of furniture in London. The board of directors have looked into the financial statements of the last two years and have noticed significant changes in different elements of Income statements and balance sheets. You are working in the same company as Management Accountant and directors have asked you to prepare a report on results of the two year's financial statements. The financial statement of the Bitmap plc are given below: Statement of comprehensive income for the year ended 2018 and 2019. 2019 2018 1000 to00 to00 Revenue 23,000 18,000 Less: Cost of sales Opening Inventory 1,800 1,700 Manufacturing cost 12,000 9.000 Total cost of goods available to sell 13,800 10,700 Less: Closing inventory 3.000 1,800 Total cost of sales 10.800 8,900 Gross profit 12,200 9,100 Less: Expenses Selling & distribution expenses 4,000 3,000 Administrative expenses 1,400 1,000 5,40 4.000 Operating profit 6,800 5,100 Less: Interest payable 1.000 500 Profit before tax 5,800 4,600 Less: Income tax (30%) 1.740 1.380 Profit after tax 4,060 3,220 Less: Dividends paid 300 200 Retained profit for the year 3.760 3.020Statement of financial position as at 31st of December 2018 and 2019. 2019 2018 1000 1000 E000 Non-current assets (net) Land and building 15,000 11,000 Equipment 1,400 1,250 Motor vehicles 1,800 1,100 18,200 13,350 Current assets Inventory 2,360 1,800 Trade receivables 2,300 1.600 Cash 500 750 5,160 4,150 Current liabilities Trade payables 1,100 1,500 Net current assets 4,060 2.650 22,260 16,000 Non-current liabilities Loan stock 3,500 2,000 Net assets 18.760 14.000 Equity Ordinary shares of fl each 10.000 10,000 Share premium 3,000 2,000 Retained earning 5,760 2.000 18.760 14.000 Required: 1. Prepare a structured report for Board of Bitmap plc, which evaluates the performance of the company in relation to profitability, liquidity, gearing, asset utilisation and investors potential. Your report must be supported by the calculations of relevant ratios in the five areas mentioned above. (25%) 2. Calculate working capital cycle in days for the Bitmap plc based on the information above, assuming 365 days, for the years 2019 and 2018 you are also required to evaluate results briefly. (5%) All calculations should be clearly shown including all appropriate workings and should be made to the nearest t000 or two decimal places where required. Total marks for Part A: (30)