QUESTION TWO [28 MARKS] Your group members intend to start a company producing ethanol from sugar cane in 2021. The name of the company will be Etha (Pty) Ltd. The total project cost is expected to be R640 000. This will comprise of the following transactions: Purchase of a building - R460 000 Purchase of equipment - R80 000 Start-up raw raw materials - R60 000 Start-up expenses - R40 000 (The money is at Etha's bank = equity) The money for buildings is borrowed from the bank. Half of the money for equipment is also borrowed and the remainder is the group's own contribution (equity). 1. Prepare a start-up balance sheet for Etha (Pty) Ltd. The balance sheet should clearly show the company's assets, values and how the assets were financed (10) 2. Calculate the company's debt-equity ratio (2) 3. Explain the difference between an income statement and a cash-flow statement (6) 4. For the bank to grant the company a loan, they would have considered a number of factors. Briefly discuss five such factors (10) QUESTION TWO [28 MARKS] Your group members intend to start a company producing ethanol from sugar cane in 2021. The name of the company will be Etha (Pty) Ltd. The total project cost is expected to be R640 000. This will comprise of the following transactions: Purchase of a building - R460 000 Purchase of equipment - R80 000 Start-up raw raw materials - R60 000 Start-up expenses - R40 000 (The money is at Etha's bank = equity) The money for buildings is borrowed from the bank. Half of the money for equipment is also borrowed and the remainder is the group's own contribution (equity). 1. Prepare a start-up balance sheet for Etha (Pty) Ltd. The balance sheet should clearly show the company's assets, values and how the assets were financed (10) 2. Calculate the company's debt-equity ratio (2) 3. Explain the difference between an income statement and a cash-flow statement (6) 4. For the bank to grant the company a loan, they would have considered a number of factors. Briefly discuss five such factors