QUESTION 3 (20 Marks) 3.1 3.1.1 3.1.2 The extracts of the financial statements of Beko Limited for 2016 and 2015 are provided below. REQUIRED Calculate the following ratios for 2016 only. Where applicable, round off answers to two decimal places Gross margin (2 marks) Inventory tumover (2 marks) Debtors collection period (2 marks) Return on assets (2 marks) Debt to equity (2 marks) Use TWO (2) appropriate ratios to determine whether the liquidity position of the company has improved since 2015. (6 marks) Suggest TWO (2) ways of improving the inventory turnover. (4 marks) 3.1.3 3.1.4 3.1.5 3.2 3.3 BEKO LIMITED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2016 R Sales (all credit) Cost of sales Operating profit Profit before tax 2 000 000 1 300 000 430 000 380 000 Profit after tax 266 000 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER: 2016 (R) 2015 (R) Non-current assets 2 500 000 1 900 000 Inventories 530 000 500 000 Accounts receivable 300 000 500 000 Cash and cash equivalents 400 000 340 000 3 730 000 3 240 000 2 600 000 Equity Non-current liabilities 2 900 000 430 000 280 000 Current liabilities 400 000 360 000 3 730 000 3 240 000