Styles and Formattin Question 2 (27 Marks) You are being appointed as the financial manager of Energy-X Bhd. Your first task is to assess the efficiency and the leverage situation of the firm and how it affects the profitability of the firm. The financial records of the past two years had been compiled for the analysis as given below: Energy-X Balance Sheet (RM millions) as at December 31, 2019 and 2020 2019 2020 Assets Cash 9 11 Accounts receivable 107 139 Inventory 198 291 Net fixed assets 550 625 B Total Assets 864 1066 I Liabilities & Equities Accounts payable 88 101 Long-term debt 353 488 Common equity 423 477 Total liabilities and equity 864 1066 Normal New Style... Pick formatting Default Paragrap Heading 1 Heading 2 Heading 3 Heading 4 List Parag Normal Normal Text P Energy-X Income Statement (RM million) as at December 31, 2019 and 2020 Page Num: 4 Page: 4/5 Section: 1/1 SetValue: 18.6cm Row: 33 Column: 23 Words: 1141 Spell Check VZ 02 Show: Valid styles Show Previews Desktop Painter Energy-X Income Statement (RM million) as at December 31, 2019 and 2020 2019 2020 Sales COGS Gross profit 1100 1250 792 875 308 375 I Operating expenses 176 212 Operating profit 132 163 52 73 Interest expense Taxes 32 36 Net profit 48 54 Industry Averages Current ratio Day sales outstanding Inventory turnover SetValue: 18.5cm Page Num: 4 Page: 4/5 Section: 1/1 Type here to search Styles and Formatting Normal New Style... Clear Format Pick formatting to apply Default Paragraph Font Heading 1 Heading 2 Heading 3 Heading 4 List Paragraph Normal Double-click to edit header Normal Text 2.5 times Show Valid styles Show Previews 33 days 5 times. Row: 33 Column: 23 Words: 1141 Spell Check || Links || OW Desktop 30 100- 34C B Painter Operating expenses 176 Operating profit 132 Interest expense 52 Taxes 32 Net profit 48 212 163 73 54 Industry Averages Current ratio 2.5 times Day sales outstanding 33 days Inventory turnover Debt ratio 5 times 50% Net profit margin 7% Required: a. Compute the ratios (according to the listed ratios as above) for 2019 and 2020. Analyse the ratios as the above between these 2 years. (10 marks) b. From (a), analyse the ratios as the above between 2020 and the industry. (10 marks) Comment the performance of the firm in terms of liquidity, efficiency, debt and profitability of the firm as a whole. (4 marks) d. Give THREE (3) suggestions on how to improve on the profitability. (3 marks) QUESTION 3 (15 Marks) firm you are responsible to forecast for the next fiscal year. Currently firm's E Styles and Formatting Normal New Style... Clear Forma Pick formatting to apply Default Paragraph Font Heading 1 Heading 2 Heading 3 Heading 4 List Paragraph Normal Normal Text P Show: Valid styles Show Previews