The financial statements for Charkas Ltd are given below for the two years ended 31 December 2016 & 2017. Charkas Limited operates a department store in the centre of a small town.

Charkas Ltd Income statement for the years ended 31^st December

Charkas Ltd Income Statement for the years ended 31st December
		2016	2017
		$000	$000
Sales Revenue		2,600	3,500
Cost of Sales		(1,560)	(2,350)
Gross profit		1,140	1,150
Wages and salaries		(320)	(350)
Overheads		(260)	(200)
Depreciation		(150)	(250)
Operating profit		310	350
Interest payable		(50)	(50)
Profit before taxation		260	300
Taxation		(105)	(125)
Profit for the year		155	175

Charkas Ltd Balance Sheet at December 31st
		2016	2017
		$000	$000
Non-current assets
Property, plant and equipment		1,265	1,525
Current assets
Inventories		250	400
Trade receivables		105	145
Cash at bank		380	115
		735	660
Total assets		2,000	2,185
Equity
Shareholders capital: 1$ per share		490	490
Share premium		260	260
Retained earnings		350	450
Total Equity		1,100	1,200
Non-current liabilities
Borrowings 10% loan notes		500	500
Current liabilities
Trade payables		300	375
Other payables		100	110
		400	485
Total equity and liabilities		2,000	2,185

Dividends were paid on ordinary shares of 65,000 and 75,000 in 2016 and 2017, respectively.

Required:

a) Compute at least 8 ratios from 4 different categories, i.e.i) two ratios from liquidity, ii) two from efficiency/activity, iii) two from debt to equity ratio, iv) two from profitability, that you think are the most important. Use end-of-year values where appropriate.

b) Using the ratios calculated in (a), comment on the business's performance from the viewpoint of a prospective investor.