QUESTION 2 2 The following information was obtained from the books of Prime Tune Ltd Condensed statement of profit or loss for the year ended December 31,2021 2020 2021 SM Turnover Gross profit Interest Profit before tax Tax Profit after tax SM 490.00 SM SM 585.00 17.50 21.10 (1.98) (1.98) 15.52 19.12 (4.65) (5.74) 10.87 13.38 Dividends Ordinary 2.30 2:40 Preference 0.08 (2.38) 0.08 (248) Profit for the year 8.49 10.90 Retained earnings b/d 22.90 29.70 Retained earnings c/d 31.39 40.60 Market price per share 1.50 1.75 Condensed statement of financial position as at September 30, Non-current assets Net current assets Total assets less current liabilities 2020 2021 SM SM 7.92 14.22 54.17 57.08 62.09 71.30 Capital and reserves Ordinary shares @$0.25 9.90 9.90 8% Preference shares @ $1 each 1.00 1.00 Retained earnings 31.39 40 60 Non-current liabilities 19.80 19.80 62.09 71.30 Required: Calculate and comment on the following ratios (a) gearing. (b) return on equity, (c) EPS, Marks 20