Question: 9. Calculate and compare the return on equity for the following two firms - A and B. Define which company is more profitable for its

9. Calculate and compare the return on equity for the following two firms - A and B. Define which company is more profitable for its shareholders and why. Both the companies are into the electronics industry. The ratios of the two companies are as follows: Ratio Company A Company B 30% 15% Gross Profit Margin Asset Turnover 0.5 6 Net Profit Margin 15% 7% Financial Leverage 3 0.5 EBIT Margin 20% 10%

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