You are financial adviser to a retailing company, Us Ltd. You obtain the accounts of its main competitor operating in the same market. Them Lbt, and extract the comparison shown below: Balance sheets as at 31 March 20x0 Us Ltd Them Ltd KOOO KOOO KOOO KOOO K000 K000 Non-current assets Land and buildings 381 286 Fixtures and fittings 342 218 Vehicles 62 59 785 563 Current assets Inventory 96 122 Trade debtors 166 124 Cash 9 6 271 252 Current liabilities Overdraft 20 21 Trade creditors 132 97 Accruals 48 42 200 160 71 92 856 655 Shareholders' funds 470 350 Share capital Capital reserves 35 65 Income statement 287 185 792 600 10% debentures 64 55 856 655 Income statement for the year ended 31 march 20x0 Us Ltd Them Ltd K000 KOOO K000 k000 570 Sales(on credit) 747 Cost of sales Opening inventory 92 102 Purchase (on credit) 381 588 473 690 Closing inventory 96 122 377 568 Gross income 193 179 Distribution costs 60 64 Administration costs 29 31 89 95 104 84 Interest charge 8 8 9 Net Income 96 75 Taxation 45 37 51 38 Dividend 37 24 Retained profit for the year 14. 14 Upon analysis this information, you observe that it reveals significant differences between the companies. REQUIRED. a) Calculate and identify the key differences in profitability and in working capital management as between the two companies. b) based upon the analysis at(a)above, recommend actions which the management of us Ltd should consider in order to improve their financial performance. c) State any reservations you may have above drawing conclusions from the comparative analysis of the two companies. You are financial adviser to a retailing company, Us Ltd. You obtain the accounts of its main competitor operating in the same market. Them Lbt, and extract the comparison shown below: Balance sheets as at 31 March 20x0 Us Ltd Them Ltd KOOO KOOO KOOO KOOO K000 K000 Non-current assets Land and buildings 381 286 Fixtures and fittings 342 218 Vehicles 62 59 785 563 Current assets Inventory 96 122 Trade debtors 166 124 Cash 9 6 271 252 Current liabilities Overdraft 20 21 Trade creditors 132 97 Accruals 48 42 200 160 71 92 856 655 Shareholders' funds 470 350 Share capital Capital reserves 35 65 Income statement 287 185 792 600 10% debentures 64 55 856 655 Income statement for the year ended 31 march 20x0 Us Ltd Them Ltd K000 KOOO K000 k000 570 Sales(on credit) 747 Cost of sales Opening inventory 92 102 Purchase (on credit) 381 588 473 690 Closing inventory 96 122 377 568 Gross income 193 179 Distribution costs 60 64 Administration costs 29 31 89 95 104 84 Interest charge 8 8 9 Net Income 96 75 Taxation 45 37 51 38 Dividend 37 24 Retained profit for the year 14. 14 Upon analysis this information, you observe that it reveals significant differences between the companies. REQUIRED. a) Calculate and identify the key differences in profitability and in working capital management as between the two companies. b) based upon the analysis at(a)above, recommend actions which the management of us Ltd should consider in order to improve their financial performance. c) State any reservations you may have above drawing conclusions from the comparative analysis of the two companies