Q.2. The following are the financial statements for Zaidus Co., for 2018 Balance sheet as on 31 March, 2018 Liabilities + OE Amount Assets Rs.) Creditors 2800000 Cash Trade Payables 1400000 Debtors Outstanding expenses 40000 Stock Provision for tax 100000 Fixed assets Long-term debt 840000 Goodwill Share capital 4200000 Reserves 2800000 Total 2100000 Total Amount Rs.) 70000 350000 490000 1050000 140000 2100000 Amount Rs.) Profit and Loss A/C for the year ended 31 March 2018 ount Rs.) Sales Cash 280000 Credit 1120000 Total Sales (-) COGS Gross Profit (-) Selling and Admin Exp. EBDIT (-) Depreciation EBIT Interest EBT Tax PAT Dividend Paid 1400000 840000 560000 140000 420000 98000 322000 42000 280000 140000 140000 42000 You are required to (a) What will your advice to investors on the solvency position of the company? Being the supplier to Zaidus Co., what would be your decision if the company wants to buy material of Rs.70000 on a three months credit. [5] (b) [5]