Refer to Tesco Annual Financial Statements 2018.

Youre working in the Finance department of Wayne Enterprises. Your company has experienced a high volume of sales and therefore it has more liquid assets (cash) then initially anticipated. Your line manager, in an attempt to diversify the portfolio, is thinking of investing 0.5 Million in shares of Tesco plc. Your line manager has asked for your opinion on the matter and has highlighted two main concerns about the potential investment; which are: the riskiness of the investment and whether the company is profitable. The financial statements of the company in their annual reports. You are required to use the accounting figures from the before exceptional items in your analysis.

(a) Calculate appropriate ratios for the years 2017 and 2018 and indicate whether the ratio highlights an improvement over prior year.