QUESTION 3 REQUIRED Use the information provided below to calculate the following ratios for 2020. Also provide a brief interpretation of each answer. The comparative figures for 2019 are given in brackets. Express answers to the ratios to two decimal places. 3.1 Profit margin (2019: 8.60%) 3.2 Debtors collection period (2019: 70.34 days) 3.3 Current ratio (2019: 1.45:1) 3.4 Debt to assets (2019: 54.78%) 3.5 Return on equity (2019: 19.97%) 3.6 Earnings per share (2019: 62.31 cents) 3.7 Acid test ratio (2019: 1.16:1) INFORMATION Extracts of the financial statements of Oak Limited for 2019 and 2020 are provided below. Oak Limited STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2020 R Sales (90% on credit) 1 254 000 657 000 Cost of sales Operating expenses: Operating profit Profit after tax 366 000 231 000 156 000 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER: 2019 2020 R R Non-current assets 609 000 171 000 216 000 555 000 150 000 237 000 93 000 300 000 168 000 Inventories Accounts receivable Cash and cash equivalents Ordinary share capital (150 000 shares issued) Retained earnings Non-current liabilities 87 000 300 000 189 000 240 000 282 000 81 000 Accounts payable Other current liabilities 75 000 210 000 273 000