0 0 0 Compute ROA, ROE and ROFL and Interpret the Effects of Leverage Basic income statement and balance sheet information is given below for six different cases. For each case, the assets are financed with a mix of non-interest-bearing liabilities, 10% interest-bearing liability and stockholders' equity. Case A B C D E F Average assets $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 Non-interest bearing liabilities 0 0 200 200 Interest-bearing liabilities 0 250 500 500 300 Average shareholders' equity 1,000 750 500 500 800 Earnings before interest and taxes (EBIT) 120 120 120 100 80 a. For each case, calculate the return on equity (ROE), return on assets (ROA) and return on financial leverage (ROFL). In all cases, the income tax rate is 40%. Round answers to one decimal place (i.e., 0.2567 = 25.7%). Use negative signs with answers, when appropriate. 0 500 80 ROA ROE 7.2 % 7.6% 7.2% B 0.057 % x 4.2 % X 1.8 % X ROFL 0 % 2.28% x 4.2 % X 1.8 % X 1.5% 0.1% X 8.4% 3.6% 7.5 % 6% D E 0.06% X 0.03% X F Check