Table 2.1 and Table 2.2 below, provide the past financial statements of Harvey Norman (HVN) and JB HiFi (JBH) - two of the largest Australian retail companies that sell various consumer products. Equity analyst, Noa Young is trying to compare Return on Equity (ROE) of these two firms based on the data below. Help Noa to

1. Calculate ROE of HVN and JBH at the end of 2020.
2. Carry out DuPont Analysis to decompose the ROE of HVN and JBH
3. Explain why one company has higher ROE than the other based on the DuPont Analysis

Table 2.1 JBH Item Income Statement ($mn) HVN 2019 2020 3414.923 3539.386 2721.92 2599.925 2019 2020 7097.7 7922.5 Revenue Operating Expenses EBITDA 6669.4 7364.4 693.003 939.461 428.3 558.1 85.259 223.591 54.7 54 Depreciation and Amortisation EBIT 607.744 715.87 373.6 504.1 23.52 53.406 14.3 36.4 Net Interest Expense Pre-tax Profit Tax Expense 584.224 662.464 359.3 467.7 165.557 175.265 109.5 151.5 Net Profit after Tax 418.667 487.199 249.8 316.2 Table 2.2 Balance Sheet HVN Item 2019 2020 Cash 215.048 313.195 Receivables 741.862 511.579 Prepaid Expenses 29.901 30.723 Inventories 395.965 391.984 Investments 28.888 30.237 Other 44.676 20.613 Total Current Assets 1456.34 1298.331 Properties, Plants & Equipment 696.207 1176.671 Intangibles(ExGW) 64.631 63.003 Goodwill 0 0 Future Tax Benefit 0 3.227 Other 0 0 Total Non-Current Asset 3342.404 4530.271 Total Assets 4798.744 5828.602 Account Payable 283.682 351.772 Short-Term Debt 494.53 233.121 Provisions 45.077 104.41 Other 75.819 96.141 Total Current Liabilities 899.108 785.444 Long-Term Debt 346.942 1237.807 Provisions 343.571 327.163 Other 11.33 0.863 Total Non-Current Liabilities 701.843 1565.833 Total Liabilities 1600.951 2351.277 Share Capital 552.25 717.925 Reserves 217.724 216.837 Retained Earnings 2397.436 2511.58 Outside Equity 30.383 30.983 Total Equity 3197.793 3477.325 Total Liabilities & Equities 4798.744 5828.602 JBH 2019 2020 119.2 251.5 236 220.3 30 30.8 886.7 739.3 0 0 4.6 3.9 1276.5 1245.8 191.5 814.5 290.3 284.4 747 747 2.7 22.2 40.8 38.4 1272.3 1906.5 2548.8 3152.3 656.9 854.1 0 164 99 131.2 196.6 1345.9 577.6 41.5 81.6 171.2 927.1 439.1 15.2 123.3 577.6 1504.7 434.8 53.7 555.6 0 700.7 2046.6 403.2 66.8 635.7 0 1044.1 2548.8 1105.7 3152.3