Consider the following information:

Prepare a succinct analysis that explain the changes in ROCE from 2008 to 2009. The marginal tax rate is 34 percent, and dividends paid on preferred stock cannot be deducted for taxpurposes.

Summary Balance Shees at December 31 2009 2008 2007 100 300 1,000 1,900 S 120 330 1,250 1,850 S 100 300 Cash Short-tem investrments Accounts receivable Inventory Property, plant, nd equipment 2 2.000 9,000 12,300 500 1,000 10,500 4,050 550 1,100 inet of accumulated depreciation) Totai assets Accrued liabilities Accounts payable Bank loan Bonds payable Deferred taxes Total liabilties Preferred stock (8%) Common stock Retained earnings Owners' equity 8,200 11,500 600 900 3 4,300 500 6,300 1,000 2,000 3,000 5,000 1,000 600 4,300 5,290 1,000 1,400 2,810 1,000 2,000 4,590 7,590 5,210 35, Suminaty Incone Statements 2009 2008 Sales Cost of goods sold Sellng andadministraticin Restructuring charges interest income nterest expense Earnings before taxes and extraordinary items sax excense Earnings before extraordinary items Gain due to retirement oi bonds, net of taxes Net incomae 22,000 (13,000) (8,000) 190) 24 (430) 404 (134) 270 0 S 270 24,000 (13,100) (8,250) 0 25 (430) 2,245 (675) 1,570 100 1,670