You have just been hired by the Bank of Nova Scotia & your manager, Ms. DeVille has come to you with a task. She has 2 customers asking for a 5 year $50,000 loan and she does not know which customer to give the loan to. Ms. Deville has completed the ratio analysis on the first company, Ursula's Wishes Limited but has not had a chance to complete the ratio analysis of the second company, Gaston's Tavern Limited. Ms. Deville is requesting that you prepare the ratio analysis on Gaston's & then provide a recommendation on which company you would lend the money to. She has provided you with the comparative balance sheet & income statement for the year ended May 31, 2022 as well as the ratio analysis of Ursula's Wishes Limited for the year ended May 31, 2022 and selected industry averages. REQUIRED: 1. Calculate 12 ratios, from the ones we covered, to help you analyze Gaston's Tavern Limited. (You can pick which ratios) 2. Based on your answers from Part 1 prepare a memo to Ms. Deville outlining your recommendation as to which company the bank should lend the money to. Make sure to include analysis of 4 of the ratios prepared in Part 1 to support your answer. Ursula's Wishes Limited Gross profit margin ratio Net profit margin ratio Rate of return on assets Current ratio Industry averages-2021 55.00% 4.50% 20.00% 1.75 2022 Ratios 56% 4.95% 25.00% 1.50 Quick ratios 1.10 1.00 Debt ratio 60.00% 61% Times Interest Earned 25.00 22.00 Earnings per Share $ 10.00 $ 8.00 Dividend Yield 14:1 15:1 GASTON'S TAVERN LIMITED INCOME STATEMENT FOR THE YEAR ENDED MAY 31, 2022 2022 2021 Sales Cost of goods sold $ 1,205,675 $1,143,140 485,600 479,120 720,075 664,020 Selling expenses Administrative expenses 330,150 315,740 274,869 264,580 Rent expense Depreciation 22,500 20,100 5,500 3,500 633,019 603,920 Income from operations 87,056 60,100 Interest expense 3,400 2,400 Income before tax 83,656 57,700 Income tax expense 12,550 8,650 Net income $ 71,106 $ 49,050 GASTON'S TAVERN LIMITED BALANCE SHEET MAY 31, 2022 2022 2021 ASSETS Cash Accounts receivable $133,820 $114,935 51,200 46,720 Inventory 82,760 72,600 267,780 234,255 Equipment 65,000 40,000 Accumulated depreciation 15,000 9,500 Land 25,000 25,000 75,000 55,500 $342,780 $289,755 LIABILITIES AND SHAREHOLDER'S EQUITY Accounts payable Income taxes payable Wages payable Note payable $134,500 $121,600 12,550 8,650 2,714 2,595 149,764 132,845 50,000 40,000 199,764 172,845 Shareholder's Equity Common shares 20,000 20,000 Retained Earnings 123,016 96,910 143,016 116,910 $342,780 $289,755 Selected data from the May 31, 2020 financial statements: Accounts receivable Inventory Accounts payable Total assets Shareholder equity Additional information: May 31, 2022 dividends May 31, 2021 dividends $ 41,290 $ 67,250 $ 101,250 $ 257,590 $ 97,860 $ 45,000 $ 50,000 Market price per share May 31, 2022 $ 30.00 Market price per share May 31, 2021 $ 32.00 Number of shares outstanding (both years) 10,000 No preferred shares