Use the information provided below to prepare the Cash Flow Statement of Rolex Limited for the year ended 31 December 2021.

INFORMATION

The following information was extracted from the records of Rolex Limited for the financial year ended 31 December 2021.

ROLEX LTD
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2021
	R
sales	4 140 000
cost of sales	(2 020 000)
gross profit	2 120 000
selling and administrative expenses	(840 000)
operating profit	1 280 000
interest expense	(80 000)
profit before tax	1 200 000
company tax	(320 000)
profit after tax	880 000

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER
ASSETS	2021 (R)	2020 (R)
NON CURRENT ASSETS	3740000	2940000
property, land and equipment	3440000	2940000
investments	300000
CURRENT ASSETS	1080000	900000
inventories	480000	500000
accounts receivable	510000	320000
cash and cash equivalents	90000	80000
total assets	4820000	3840000

EQUITIES AND LIABILITIES
equity	3 120 000	2 600 000
ordinary share capital	2 000 000	2 000 000
retained earnings	1 120 000	600 000
non current liabilities	800 000	400 000
long-term loan	800 000	400 000
current liabilities	900 000	840 000
accounts payable	480 000	560 000
company tax payable	160 000	80 000
dividends payable	260 000	200 000
total equities and liabilities	4 820 000	3 840 000

Additional information

• All purchases of inventories are on credit.

• The selling and administrative expenses include depreciation of R320 000.

• Property, plant and equipment were purchased during the year but there were no disposals.

• The total dividends for the year ended 31 December 2021 amounted to R360 000.

• The issued share capital consisted of 100 000 ordinary shares.

• The market price of the shares on 31 December 2021 was R35

Use the information provided in QUESTION 4 to answer the following questions

5.1 Calculate the following ratios for 2021 only. Express the answers to two decimal places.

5.1.1 inventory turnover

5.1.2 creditors payment method

5.1.3. return on equity

5.1.4 debt to asset

5.1.5 price/earnings ratio

5.1.6 acid test ratio

5.1.7 dividend yield

5.2 comment briefly but meaningfully on the following ratios (comparative figures are provided in brackets)

5.2.1 Gross Margin (2021: 51.21%; 2020: 60.45%)

5.2.2 Current ratio (2021: 1.20:1; 3030:1.07:1)

5.2.3. return on assets (2021: 25.56%; 2020: 30.42%)