You have been appointed as a financial analyst by Ramada Co. Ramada Co has identified Applied Co as a possible acquisition within the same industry. Your role is to critically assess the financial performance and conditions of Applied Co and highlights area of concerns to the members of Ramadas board of directors.

The following are the key financial data and information for recent years ending 31 December

Applied Co	2017	Industry average KPI
Gross profit margins %	61	45
Operating profit margins %	37.6	28
Days of account receivable outstanding (days)	40	41
Current ratio	1:1	1.6:1
Quick ratio	0.57:1	1.4:1
Debt/ equity ratio %	220	240

Required:

Prepare a report for the Ramadas board of directors. In your report you should

1. Critically analyze and discuss the recent financial performance and financial conditions of Squair Co and highlight areas of concern for the future
2. State clearly any limitations and assumptions that you made in your calculations.
3. Marks will be awarded for Professional format, structure and presentation of the report.