Exercise 3-25A (Static) Using ratio analysis to assess return on equity LO 3-6 The following information was drawn from the Year 5 balance sheets of two companies: During Year 5, Butler's net income was $25,200, while Lynch's net income was $43,200. Required: a. Compute the return-on-equity ratio to measure the level of financial risk of both companies. b. Compare the two ratios computed in Requirement a to identify which company is performing better