Consider the following financial statements.

INCOME STATEMENT	2021	2022
Sales	$62,200	$60,334
Cost of Goods Sold	$37,700	$26,390
Depreciation	$4,600	$5,636
EBIT	$19,900	$28,308
Interest	$6,400	$6,912
EBT	$13,500	$21,396
Tax	$2,835	$4,493
Net Income	$10,665	$16,903
Dividends	$2,050	$10,142
Addition to Retained Earnings	$8,615	$6,761

BALANCE SHEET	2021	2022		2021	2022
Cash	$9,400	$6,580	Accounts Payable	$15,620	$23,430
Accounts Receivable	$8,400	$4,200	Current Liabilities	$15,620	$23,430
Inventory	$8,840	$4,862	Long-term Debt	$25,600	$38,400
Current Assets	$26,640	$15,642	Total Debt	$41,220	$41,220
			Retained Earnings	$8,200	$16,815
Fixed Assets	$51,800	$72,520	Common Stock	$29020	$9,517
			Total Equity	$37220	$26,332
Total Assets	$78,440	$88,162	Total Liabilities & Equity	$78,440	$88,162

Calculate ROE for each year.

2021: %

2022: %

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Allowed attempts: 3

Question 2

Use DuPont Analysis to decompose ROE.

• Profit Margin 2021: % 2022: %
• Total Asset Turnover 2021: 2022:
• Equity Multiplier 2021: 2022:

Answer rating: 100% (QA)

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