Question 3 Footfall Manufacturing Ltd. reports the following financial information at the end of the current year: Net Sales $100,000 Debtors turnover ratio (based on net sales) 2 Inventory turnover ratio 1.25 Fixed assets turnover ratio 0.8 Debt to assets ratio 0.6 Net profit margin 5% Gross profit margin 25% Return on investment 2% Use the given information to fill out the templates for income statement and balance sheet given below: Income Statement of Footfall Manufacturinf Ltd. for the year ending December 31, 20XX (in $) Sales 100,000 Cost of goods sold Gross profit Other expenses Earnings before tax Tax @50% Earnings after tax Balance Sheet of Footfall Manufacturing Ltd. as at December 31, 20XX (in $) Liabilities Amount Assets Amount Equity Net fixed assets Long term debt 50,000 Inventory Short term debt Debtors Cash TOTAL TOTAL (10 marks) Question 3 Waterfront Inc. wishes to borrow on a short-term basis without reducing its current ratio below 1.25. At present its current assets and current liablities are $1,600 and $1,000 respectively. How much can Waterfront Inc. borrow? (2 marks)