Question: Answer the questions below based on the following information. The tax rate is 35 percent and all dollars are in millions. a. Calculate each company's

Answer the questions below based on the following information. The tax rate is 35 percent and all dollars are in millions.

a. Calculate each company's ROE, ROA, and ROIC.
b. Why is Stork's ROE so much higher than Locktite's? Does this mean Stork is a better company? Why or why not?
c. Why is Locktite's ROA higher than Stork's? What does this tell you about the two companies?
d. How do the two companies' ROICs compare? What does this suggest about the two companies?

Locktite Inc. Earnings before interest and taxes Debt (at 10% interest) Equity S380 S240 S760 Stork Systems $ 394 $1,240 $ 310

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