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First Question: Read and analyze the following financial statements for SALAH CO. Then answer the questions: Income statement (10 marks) Statement of financial position For year ended 31/12/2021 As of 31/12/2021 8:2021: :2020: -2021: :2020 Sales (80% credit) 80000 50000 Cash and Equivalents 15000 13000 (30000) Cost of Goods Sold 16000 (14000) Accounts Receivable 9000 9000 Gross Profit 50000 Inventory 36000 8000 Total Current Assets 40000 30000 Operating expenses (17000) (14500) Property. Plant & Equipment(net) 55000 43000 EBIT 33000 21500 Total Assets 95000 73000 Interest Expense (3000) (1000) Total Current Liabilities 18000 10000 Earnings Before Taxes 30000 20500 Long-term Debt 22000 18000 Taxes @ 40% (12000) (8200) Total Liabilities 40000 28000 Net Income 18000 12300 Common Stock 40000 40000 Treasury shares (3000) (3000) Retained Earnings 18000 8000 Total Shareholder's Equity 55000 45000 Total Liabilities and Owner's Equity 95000 73000 First question: SALAH Co. For 2021: (ANALYZE & PUT YOUR COMMENT FOR EACH STEP, THEN PUT YOUR FINANCIAL ANALYST) 1. Analyze the following items horizontally: sales, cost of goods sold, gross profit, inventory. 2. Analyze the following items vertically: sales, inventory, cost of goods sold, net income 3. Compute current ratio, quick ratio. Accounts receivable turnover, days to sell inventory. -liquidity analysis. 4. Compute total debts to assets ratio, times interest earned. -solvency analysis. 5. If the company sells inventory costs $2000, by $ 2500 on accounts, what are the effects on the following ratios: working capital, current ratio, quick ratio, collection period. - compute new ratios. 6. Compute ROA, ROCE. And their components

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