Q2.3.

Given below is a range of financial ratios for two companies that both operate in the retail trade.

	Rigby Ltd	Rialto Ltd
Gross profit %	60%	32%
Operating profit %	28%	10%
Asset turnover	0.88 times	2.2 times
ROCE	22%	22%
Current ratio	2.0:1	1.8:1
Quick ratio	1.2:1	0.4:1
Inventory turnover	4.8 times	10.3 times
Trade receivable collection period	41 days	3 days
Trade payables payment period	62 days	70 days
Gearing ratio	33%	50%
Interest cover ratio	16 times	5 times

Required :

1. Comment upon what the ratios indicate about each business.
2. One of the businesses is a supermarket and the other is a jeweller who supplies some goods on credit to long standing customers. Identify which business is a supermarket and which one is the jeweller.