QUESTION FOUR (20 MARKS) REQUIRED Use the information provided below to answer the following questions. Note: Use the formulas provided in the formula sheet only (that appear after QUESTION 5). Answers to the ratios must be expressed to two decimal places. 4.1 What percentage of the sales is made up of net income? (2 marks) 4.2 Calculate TWO (2) appropriate liquidity ratios and comment on the liquidity of the company. (6 marks) 4.3 Calculate the relevant ratios and comment on the effectiveness with which the company has employed the debtors and creditors. (6 marks) 4.4 Calculate TWO (2) appropriate ratios that would be used to assess the profitability of the company by examining the income from operations and the after-tax returns earned. Comment on your calculations. (6 marks) INFORMATION Excerpts of financial data of Markram Limited for 2022 are as follows: Statement of Comprehensive Income for the year ended 31 December 2022 R Sales 6 000 000 Cost of sales 4 000 000 Opening inventory 200 000 Purchases ? Closing inventory 500 000 Operating profit 1 200 000 Interest expense 200 000 Profit before tax 1 000 000 Company tax 270 000 Statement of Financial Position as at 31 December 2022 R Non-current assets 3 500 000 Inventories 500 000 Accounts receivable 1 400 000 Cash 2 000 Bank overdraft 30 000 Ordinary share capital 940 000 Retained earnings 132 000 Long-term loan 3 600 000 Accounts payable 700 000 Additional information Ninety percent (90%) of the sales is on credit. All purchases are on credit. Credit terms to debtors are 60 days and credit terms from suppliers are 90 days