SECTION A - You MUST answer the question in this section Question 1 (COMPULSORY) The income statement and the statement of financial position of Colmar Ltd, a retailer, are presented below for the last two years: Statement of financial position for the year ended 31 December 2019 ASSETS 000 2020 000 Non-current assets Property plant and equipment 3,000 3,000 Premises 10,000 10,000 Fixtures, equipment and vehicles 3,600 4,840 16,600 17,840 Trade investments at cost 2,400 0 19,000 17,840 Current assets Inventories 5,440 6,800 Trade receivables 4,620 6,000 Cash 0 0 10,060 12,800 Total assets 29,060 30,640 EQUITY AND LIABILITES Equity Ordinary 1 shares 4,000 4,000 Retained earnings 20,252 20,252 24,252 24,252 Non-current liabilities Loan (Repayable 2025) 1,200 1,200 Current liabilities Trade payables 3,200 3,840 Bank overdraft 408 1,348 3,608 5,188 Total equity and liabilities 29,060 30,640 Module Code: 4ACCN001W [Question 1 continues on the next page] [Question 1 continued from previous page] Income statement for the year ended 31 December Page 3 of 9 2019 2020 000 000 Sales revenue 37,800 45,400 Cost of sales -28,350 -35,600 Gross profit 9,450 9,800 Overheads -7,410 -7,800 Operating profit 2,040 2,000 Income from investments 200 0 Profit before taxation 2,240 2,000 Taxation -448 -400 Profit for the year 1,792 1,600 Additional information: The market price of the shares of the business was 6 for 2019 and 4 for 2020. Required: a) Calculate the following financial ratios for Colmar Ltd for 2019 and 2020: (Prepare a Table showing all computations for each year; Round up numbers to a maximum of one decimal place) (i) Gross profit margin (ii) Operating profit margin (iii) Return on ordinary shareholders' funds (iv) Current ratio (v) Acid test ratio (vi) Inventories turnover period (vii) Settlement period for receivables (viii) Gearing ratio (ix) Earnings per share (x) Price/Earnings ratio (15 marks) b) Using the ratios calculated in (a) and any other information that you consider helpful, analyse the performance and position of Colmar Ltd over the period from the viewpoint of a potential investor. [END OF SECTION A] [SECTION B STARTS ON THE NEXT PAGE] (15 marks) (Total 30 marks)