Lexington Inns reported these figures for 2014 and 2013 (in millions):

Requirements
1. Use DuPont analysis to compute Lexington's return on assets and return on equity for 2014.
2. Do these rates of return suggest strength or weakness? Give your reason.
3. What additional information do you need to make the decision in requirement 2?

Transcribed Image Text:

2014 2013 Balance sheet Total assets Common share capital Retained earnings Other shareholders' equity $15,702 80 11,519 (3,005) $13,728 680 16,499 9,095) Income statement Net sales Operating income Net income $25,500 4,025 1,500 $27,500 3,813 1,550