The following information, for the year to 31 December 20X9, is available for Fun Co which operates in the toys and games industry. $'000 7,660 1,200 Sales Gross profit Operating profit Capital employed Current assets 590 3,330 400 The cost of capital of Fun Co is 12% per annum. Fun Co sold 350,000 units in the year ended 31 December 20X9. Total sales for the toys and games industry for the year were $61,280,000. - Task 1 6 marks Calculate the following performance measures for Fun Co for the year ended 31 December 20X9: Operating profit margin (to one decimal place) Asset turnover (to one decimal place) times Return on investment (to one decimal place) Residual income (to nearest $'000) Market share (to one decimal place) '000 - Task 2 2 marks Return on investment (ROI) and residual income (RI) are both measures of investment performance. Does each of the following statements describe a feature of ROI only, RI only, both ROI and RI or neither of the two measures? ROI only Rl only Both Neither Based on profit rather than cash flow Ensure(s) that managers will select investment projects with positive NPV Facilitates the comparison of performance of business units of different size Provide(s) a relative measure of investment performance - Task 3 2 marks An analyst has calculated the following ratios for Fun Co for comparison with the toys and games industry average. Fun Co 1.4:1 55% Toys and games Industry average 1.2:1 30% Current ratio Gearing Interest cover Acid test 0.8:1 0.8:1 Complete the following commentary on Fun Co's performance relative to the industry average. Fun Co's liquidity is than the industry average. tter or worse Its capital gearing is safer or riskier than the industry average. better or worse Its ability to service its loans is than the industry average, which could mean that Fun Co is having a level of profitability than the industry average. higher or lower