Question FOUR The financial statements for Moscato Plc are given below:

Question FOUR The financial statements for Moscato Plc are given below: Income Statements for the year ending 31 December: 2018 '000 Sales Cost of sales Opening inventory Purchases Closing inventory Gross profit Administrative expenses Selling and distribution costs Loan interest Profit before tax Tax Net Profit 1,500 7,000 -700 2018 '000 15,000 7,800 7,200 -500 -300 -500 5,900 -1180 4,720 2018 '000 1,800 6,500 -1,000 2017 '000 10,000 6,300 3,700 -850 -200 -100 2,550 -510 2,040 Statements of Financial Position as at 31 December: ASSETS Non current assets Property, plant and equipment Current assets Inventories Trade receivables Bank EQUITY & LIABILITIES Capital and reserves Ordinary share capital (nominal value 1.00) Profit and loss account reserve Current liabilities Trade payables Long term liabilities Bank loan 2018 '000 5 of 7 700 5,500 800 2018 '000 30,000 7,000 37,000 19,000 6680 25,680 7,200 4,120 37,000 2017 '000 1,000 3,500 1,500 2017 '000 15,000 6,000 21,000 12,000 4,000 16,000 4,000 1000 21,000 Required A. State the formula and calculate the following ratios for Moscato Plc for 2017 and 2018 (15 marks) B. i. ii. iii. iv. Return on capital employed Net profit margin Current ratio Quick ratio (acid test ratio) Trade receivables days V. vi. Gearing ratio Using the above figures and additional ratios, evaluate the differences in performance between 2017 and 2018 for Moscato Plc (10 marks)