question 3.1 to 3.4

125) QUESTION THREE The following information was selectively extracted from the accounting records of Green Chilli Ltd as at 28 February 2016 (the end of their financial year) 2015 2016 Sales (50% on credit) Cost of sales (80% of goods purchased on credit) Net Income after tax |Tangible Assets 2 200 000 1 200 000 240 000 1 500 000 200 000 100 000 50 000 250 000 210 000 1 000 000 250 000 140 000 | 1 470 000 300 000 220 000 620 000 410 000 65 000 1 000 000 230 000 Inventory Receivables Cash Payables Loans at 9% pa. Share Capital(500 000 ordinary shares at R2 each Retained Income Share premium 140 00 NB a. Shares are currently trading at R4,10 per share. Calculate 31 The debtors average collection period and comment. (Last year was 37 days) Note 3.2 The creditors payment period and comment (Last year was 88 days - All creditors 3.3 The price to earnings ratio for 2016 and explain the significance of this ratio. (9) Debtors are given 30 days net to settle their accounts accounts are 90 days less 2%). The debt equity ratio and explain its significance to decision makers 3.4 QUESTION FOUR [20] 41 Distinguish between 4 1.1 A participating preference share and a convertible preference share. (2) 4.1.2 Share repurchase and a residual dividend 4.2 Furn Services has experienced a reasonable trading year. They are deciding whether to pay out R124 000 in accumulated cash in the form of a dividend to