QUESTION FIVE The trial balance of Miyanda Traders, after the calculation of the gross profit, was as follows: Dr (K) Cr(K) Gross profit 120 000 Sundry expenses 57 000 Non-current assets (cost) 400 000 Non-current assets (provision for depreciation) 82 000 Trade receivables 55 000 Trade payables 85 000 Inventory at 31 December 2019 125 000 Cash 5 000 Bank loan (repayable 31 January 2020) 35 000 Capital 320 000 642 000 642 000 Additional information for the year ended 31 December 2019: 1. Mark-up on cost of sales, 25%. 2. Depreciation for the year on non-current assets, K15 000. Required (a) Calculate the following for the year ended 31 December 2019: (0) Revenue (sales) [2 marks] Net profit ratio [2 marks] (ii) Return on Capital Employed ratio [2 marks] (iv) Quick ratio (acid test) [2 Marks] (b) Explain to Miyanda why the quick ratio (acid test) is a better measure of liquidity than the working capital ratio (current ratio). [4 Marks) (c) Comment upon the adequacy of Miyanda's cash for the next three months. Give one reason for your comment. [4 Marks] (d) Suggest four ways in which Miyanda might increase the cash in the business. [4 Marks] [Total: 20 Marks]