REQUIRED Use the information provided below to anower the following questions. (Arowers to rabios must be expressed to two decimal places.) 2.1 Compare and comment on the profitabily of both companies by using the folowing rabios: 2.1.1 Return on capital employed (4 marks) 2.1.2 Profit margin (Net profit margin) (4 marks) 2.2 Calculate the earnings retention ratio of both comparies and explain how shareholders can beneft from a higher retention rabio. (6 marks) 2.3 Compare the two companies regarding the anount of debt that each company uses to finance its assets (as a percentage). (4 marks) 24 Suggest TWO (2) ways in which KLM Limited can improve its gross profit margin ratio, without increasing its selling prices. (2 marks) INFORMATION Extracts for the year ended 31 December 2022 of the Statement of Comprehensive Income and Statement of Financial Position are given below for two companies viz. KLM Limited and ZAP Limited. Extract of Statement of Comprehensive hcome for the year ended 31 December 2022 \begin{tabular}{|l|r|r|} \hline & KLMLimited & \multicolumn{1}{|c|}{ZAPLimited} \\ \hline Sales & \multicolumn{1}{|c|}{ R } & \multicolumn{1}{c|}{ R } \\ \hline Cost of sales & 6800000 & 2000000 \\ \hline Depreciation & 4600000 & 864000 \\ \hline Other operating expenses & 280000 & 40000 \\ \hline Interest on loan & 260000 & 50000 \\ \hline Company tax & 180000 & 60000 \\ \hline \end{tabular} Note: All the income and expenses of both companies are induded in the figures above. Extract of Statement of Financial Position as at 31 December 2022