QUESTION 2 You are a consultant for Glory Lod, a quoted company operating in the manufacturing sector. Following area Statement of Profit or Loss and Statement of Financial Position with comparatives for the year ended 31" December 2018 2018 Statement of Profit or Loss for the year ended 31" December, 2018 2017 GHS Sales revenue 3.095,576 1909.051 Cost of sales 2.400.609 1.441.050 Gross profit 692.967 467,101 Interest receivable 744 Administration expenses 223 72 Operating profil 360,245 241,011 Interest 18,115 Profit before taxation 342,130 225.100 Income tax expense 74.300 31.272 Profit for the year 267030 193,830 Statement of Financial Position as at 31 December 2018 2018 2017 GHS GHS Non-current assets Property, plant and equipment 656,071 Current assets Inventory 6.550 Trade receivables 905,679 807,712 Pepayment and accredincome 97,022 45,729 Cash at bank and in hand 1068.450 1.008 154 Totalsts 1.870,630 1664,495 Equity and liabilities Equity Ordinary shares 258,178 258,178 Income surplus 651,721 410,591 Non-current liabilities 10% eck 100,000 Current liabilities Trade payables 627,018 545,340 Accruals and deferredince 81,279 Corporate taxes 108,000 37,200 Others 44,434 895.656 Total cquity and liabilities 1.870,630 1664,495 Required: a Calculate the following ratios i Profitability ratios - Return on Capital Employed. Return on Equity, Gross profit margin and Net profit margin ii. Long term solvency and stability - Dob'Asset ratio, Gearing ratio and Interest cover it. Short-term solvency and liquidity - Current ratio and Acid test ratio iv. Efficiency (turnover ratios) - Account receivable collection period, Account payable payment period, Inventory tumover times) b. Prepare a report addressed to the Chief Executive Officer, assessing the relative performance and financial position of Glory Lad for the year ended 31" December, 2018 (14 marks) (Total 20 marks)