The financial statements of Megah Holding Bhd for the year ended 31 December 2020 are as follows:

Statement of Profit or Loss and Comprehensive Income for the year ended 31 December 2020

	RM
Sales (70% on credit)	1,125,000
Less: Cost of sales	622,500
Gross profit	502,500
Less: Operating expenses : Interest Profit before taxation : Taxation (24%)	322,500 24,750 155,250 37,260
Net profit after tax	117,990
Less: Dividend	75,000
Net profit	42,990

Statement of Financial Position as at 31 December 2020
					RM
Non-Current Assets						1,225,000
Current Assets
Marketable securities Accounts receivables Prepayments						50,000 70,000 87,500
Inventories						262,500
Cash and bank balances						37,500
Total Current Assets						507,500
Total Assets						1,732,500
Liabilities and stockholders equity
Accounts payable						94,500
Notes payable						62,500
Accruals						52,750
Total Current Liabilities						209,750
Non-current debt						372,750
Common stocks (RM1.50 each)						1,050,000
Retained earnings						100,000
Total Liabilities and Shareholders Equity						1,732,500

Additional information:

1. The average industry ratios for the year ended 2020 are as follows:

Current ratio		2.0 times
Quick ratio		1.1 times
Inventory turnover		7.0 times
Average collection period		50 days
Debt ratio		40.5%
Times interest earned		7.0 times
Operating profit margin		10.0%
Return on equity		20.0%
Dividend per share		RM0.20
Dividend payout ratio		50.0%

2. Assume 360 days in a year.

Required

1. Calculate the above ratios for Megah Holding Berhad for the year ended 31 December 2020.
2. Based on answer in (a) above, discuss on the firms liquidity performance as compared to the industry.
3. Explain the importance of time series analysis and cross-sectional analysis.