Part One

The directors are extremely concerned about the fall in working capital. Provide a comprehensive analysis of the accounts of Greenway Builders Ltd using an appropriate range of financial ratios in order to investigate. For the ratios you calculated, comment on any areas of concern identified and suggest reasons as to why these changes in performance may have occurred. Your workings $($e$.$g$.$ ratio calculations$)$ should be attached as an Appendix in your final report, and the ratios you have calcu lated should be placed in a table at the appropriate point of the report. Profit & Loss account $2021-2023$

$31$st December $202131$st December $202215$th December $2023$

$\text{'}000\text{'}000\text{'}000\text{'}000\text{'}000\text{'}000$

Sales $183019001750$

Construction Costs:

Labour costs $-570-500-520$

Materials $*-650-500-500$

Subcontractor $-45-30-80$

Production overheads $-280-1545-200-1230-280-1380$

Gross Profit $1545285670370$

Other costs:

Administration salaries $-200-210-230$

Administration overheads $-30-10-26$

Marketing expenses $-20-250-20-240-20-276$

Net Profit $3543094$

Interest expence $($Finance cost$)-20-50-20$

Taxation $0-20-70-120-120-140$

Net Profit after Tax $181515310-46$

$*$ Materials are purchased on credit from a single supplier Balance Sheet $2021-2023$

$31$st December $202131$st December $202215$th December $2023$

$\text{'}000\text{'}000\text{'}000$

Fixed assets $450800924$

Current assets:

Inventory $90160180$

Debtors $150200220$

Bank balance $304035$

Total current assets $270400435$

Current liabilities:

Creditors $10595220$

VAT $05060$

PAYE $06080$

Corporation tax $070120$

Bank overdraft $000$

Total current liabilities $105275480$

Working capital $*165125-45$

Long term loan $100100100$

Net assets $515825779$

Equity:

Share capital $500500500$

Reserves $15325279$

$515825779$

$*$ Current assets $-$ current liabilities