The following is the Statement of Financial Position as at 31 March 2020 of Motorola Ltd: $ Assets Non-current Assets Freehold Land Plant & Equipment Motor Vehicles 200,000 100,000 50,000 350,000 Current Assets Stock Trade Debtors Bank 56,000 85,000 25,000 166,000 516,000 Total Assets Equity and Liabilities Equity 50,000 Ordinary Shares of $1 each 150,000 5% Non-redeemable Preference Shares of $1 each Retained Profit brought forward Retained Profit for the year Total Equity 50,000 150,000 120,000 62,000 382,000 Non-current Liabilities 8% Debentures 100,000 Current Liabilities Trade Creditors Total Liabilities Total Equity and Liabilities 34,000 134,000 516,000 Question 1 contd Other information relating to the year ended 31 March 2020: 1. Sales $555,000 (of which $55,000 were for cash) 2. Purchases $365,000 (of which $65,000 were for cash) 3. Stock at 1 April 2019 $54,000 4. Industry average of gross profit ratio and net profit ratio is 10% and 5% respectively. 5. Net profit for the year is 55,000. Required: (a) Calculate to two decimal places, the following ratios: (i) Return on capital employed (ii) Net profit ratio (iii) Gross profit ratio (iv) Return on owners' equity (Be sure to show the formulae and necessary workings.) (2.5 marks) (2.5 marks) (2.5 marks) (2.5 marks) (b) Using the above ratios, comment on the profitability of the company. (7.5 marks) The budgeted output for a period is 4,000 units and the budgeted time for the production of these units is 400 hours. The actual output in the period is 4,600 units and the actual time worked by the labour force is 360 hours. Required: Calculate Capacity Ratio; Efficiency Ratio and Production volume ratio. (7.5 marks) (Total 25 marks)