QUESTIONS The following information is a summary of the financial information for "MAYE HOT Company Limited, producers of Guinea Fowls. Current Year Previous Year Revenue 77,521 71,000 Cost of Sales 31.256 28,772 Salaries and Wages 23,027 22,562 Other cost 15,489 12,160 Profit before Interest and Tax 17,749 16,506 Interest 4,553 4,863 Tax 7,347 6,726 Profit after Interest and Tax 11,849 10,917 Dividends Payable 7.800 6,100 Shareholders' Funds 42,900 38,087 Long Term Debt 17,000 20,500 Number of Shares in Issue 17,000 17,000 P/E Ratio 14.0 13.0 Industry P/E ratio 15.2 15.0 Required: a) Compute and interpret the following ratios of "MAYE HOT" Company Limited for each of the years i. Profit Margin in Return on Equity iii. Return on Capital Employed iv. Earnings Per Share (EPS) V. Debt-to-Equity Ratio 2 marks each @ 5 (10 Marks) b) Comment on the performance of the firm using the previous year as the basis for your comment. (2 Marks) c) List four qualitative issues ratio analysis may not tellus. (2 Marks) d) List two limitations of the ratio analysis. (1 Marks (15 Marks) 3 | Page Lecturers: Mrs. Gladys A.A. Nabieu & Prof. Charles Barnor