The following information relates to the business of Chef One, and the owner is concerned about the profitability and financial structure of his business at 30 June 2018, especially since the bank is requiring repayment of the business's overdraft.

Ratio analysis and report

Inventory at 1 July 2016 was $22 500.

Required

(a) Calculate the following ratios for 2017 and 2018:

profit margin

return on proprietor's capital

current ratio

quick ratio

equity ratio

inventory turnover.

(b) Write a report to the owner highlighting strengths and areas of concern in relation to the profitability, liquidity and financial stability of the business including recommendations to improve areas of concern.

(c) Identify the cash flow ratios that would be useful to calculate to assist K. Pastry to more fully understand the financial health of the business.

solution of this questions with complete detail