QUESTION 4 Use the information provided in QUESTION wwww the following questions 41 Calculate the following for lov 2021. Exprewe decimal place. 4.1.1 Gross margin Q marka 4.1.2 Inventory burnover mark 41.3 Acid bestratio 22 marks) 41.4 Debt to equally (2 marka I 4.1.5 Earings per share (2 markas 42 (4 marks) 43 marks Are the collections from credit sales satisfactory? Motvate your answer by using the relevant ratio Would the shareholders of Harmony Limited be satisfied with the return on their investments? Motivate your answer with the use of a relevant ratio. Suggest THREE (3) ways in which Harmony Limited can improve to gross margin ratio, without increasing the seiling price of the inventories 44 marks) (20 Marks) QUESTION 3 Use the information provided below to prepare the Cash Flow Statement of Harmony Limited for the year ended 31 December 2020 INFORMATION The information provided below was extracted from the accounting records of Harmony Limited on 31 December 2020: Harmony Limited Extract of Statement of Comprehensive Income for the year ended 31 December 2020 R Sales 6 600 000 Cost of sales (3 900 000) V Gross profit 2 700 000 Operating expenses (1 710 000) Selling and administrative expenses 1 260 000 Depreciation 450 000 Selling and administrative expenses 1 260 000 Depreciation 450 000 Operating profit 990 000 Interest expense (270 000) Profit before tax 720 000 Company tax (240 000) Profit after tax 480 000 Extract of Statement of Changes in Equity for the year ended 31 December 2020 Retained earnings R Balance on 01 January 2020 1 500 000 Profit after tax 480 000 Dividends paid and proposed in 2020 (180 000) Balance on 31 December 2020 1 800 000 Balances extracted from the Statement of Financial Position as at 31 December 2020 2019 R R Plant and equipment 3 750 000 3 000 000 210 000 240 000 Investments 1 290 000 1 230 000 Inventories 1 140 000 1 050 000 Accounts receivable 300 000 210 000 Cash and cash equivalents 1 860 000 1 860 000 Ordinary share capital 1 800 000 1 500 000 Retained earnings 000 400 Retained carings 1 800 000 1 500 000 Long-term loan 360 000 210 000 Accounts payable 2 520 000 1 962 000 Dividends payable 120 000 150 000 Income tax payable 30 000 48 000 Note: (a) Plant and equipment was purchased but there was no disposal. (b) The number of ordinary shares in issue was 930 000 c (c) All purchases and sales of inventory were on credit. Credit terms to debtors are 30 days. Debtors took approximately 28 days to settle their accounts during 2019, (d) QUESTION 4 Use the information provided in QUESTION 3 to answer the following questions