(Subject Analysis Of Financial Statements)

Q.No.2 (a) You have a client who has the opportunity to invest $30000/- in one of the two companies from a single industry. The only information he has given you on these companies is shown below. According to your client the word HIGH refers to the top third of the industry; Average is the middle and third; "LOW is the bottom third. Required: your client would like you to advise him on which company to invest in. Write a brief memo to your client justifying your recommendation. Particulars Company 1 Company 2 Earnings Per Low High Share Return on Total Low High Assets Debt to Equity Average High Ratio Current Ratio Low Average Price/Earnings High Low Dividend Yield Average High Ratio