The extracts of the financial statements of Disney Limited for 2020 and 2021 are provided below.

Disney Limited Statement of Comprehensive Income for the year ended 31 December 2021 R

Sales 1 960 000

Cost of sales 1 240 000

Operating profit 472 000

Interest expense 48 000

Profit before tax 424 000

Profit after tax 305 280

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER: 2021 (R) 2020 (R)

	2021	2020
Assets
Non-current assets	2 320 000	1 960 000
Inventories	720 000	440 000
Accounts receivable	360 000	500 000
Cash and cash equivalents	440 000	340 000

Totals	3 840 000	3 240 000
Equity and liabilities
Equity	2 960 000	2 040 000
Non-current liabilities	480 000	820 000
Accounts payable	400 000	380 000

Totals

3 840 000

3 240 000

Additional information

1. The profit after tax for the year ended 31 December 2020 was R240 000.

2. All purchases and sales of inventories are on credit. Use the information provided above to answer the following questions:

3.1 Calculate the ratio (expressed to two decimal places) for 2021 to reflect each of the following:

3.1.1 The rate at which inventory is sold (2 marks)

3.1.2 The ratio of the company's net profit to its total revenue. (2 marks)

3.1.3 A comparison of the companys long-term debt to its equity. (2 marks)

3.1.4 An indicator of how profitable a company is relative to its total assets. (2 marks)

3.1.5 Determination of how easily a company can pay the interest on its outstanding debt. (2 marks)

3.1.6 The period that the company takes to collect the money owed to it from its credit sales. (2 marks)

3.2 Will the company be able to pay its short-term debts if business conditions are unfavourable? Use an appropriate ratio to motivate your answer.

3.3 Comment on the returns of the shareholders on their investments (expressed to two decimal places) over the two-year period (2021 and 2022). Motivate your answer with the relevant calculations.