Selected income statement and balance sheet data from Merck & Co. for Year 5 are reproduced below. Assume fixed assets and working capital are operating and a 50% tax rate.

Requirements

1. Calculate ROCE for year 5.

2. Calculate RNOA for year 5.

3. Calculate Leverage for year 5.

4. Calculate Spread for year 5.

Year 5 Income Statement Data Revenues.... $542 Operating income... 35 Interest expense. 7 Pretax income... 28 Income taxes 14 Net income.... 14 Balance Sheet Data Long-term operating assets...... $ 52 Working capital ...... 123 Total liabilities...... 50 Total shareholders' equity..... 125