Question 2: Financial Analysis (CLO2) 12 Marks You have the following Balance sheet and income statement for Etisalat company as you can see in the below balance sheet and income statement. Consider 365 days in a year. Balance Sheet as at December 31, 2021, Income statement as at December (Thousands of Dollars) 31, 2021. (Thousands of Dollars) Assets Sales 1608500 Cash 78500 Costs of goods 1392500 sold Accounts Receivable 336000 Administrative 145000 expenses Inventory 71000 241500 EBIT Total Current Assets 656000 Interest 24500 Net fixed assets 292500 EBT 46500 Total assets 948500 Tax (39%) 18135 Liabilities and owners equity Accounts payable 130000 Net income 28365 Notes payable 84000 Oh Other current liabilities 117000 Total current liabilities 331000 Long term debt 256500 Common equity 200000 Retained earnings 161000 Total liabilities and owners 948500 'equity A) Calculate the below ratios for Etisalat company for 2021, compare them with the industry average data, and comment on its strengths and weaknesses. B) Suppose the company had increased its sales as well as its inventories, accounts receivable, and common equity during 2021. How would this will affect the ratios you calculated and the performance of the company? C) If Etisalat company uses more leverage, what are the impact on the ROA and ROE? Answer as discussed in the class. . Required ratios Formula Your Ratio Industry average 2.1 12.1 35 Current Ratio Fixed Assets Turnover Average Collection period Return on Assets (ROA) Current Assets/Current Liabilities Sales/ Fixed Assets Accounts Receivables / Average sales per day Net income / Total Assets 3.6% 60% Debt Ratio Total Liabilities / Total assets Ans