$\backslash$table$[[$Assets$,\backslash$table$[[$Current$],[$data$]],\backslash$table$[[$Project$],[$changes$]],\backslash$table$[[$After$],[$completing$],[$the project$]],],[$Cash$,$$$300,,$$$300,],[$Fixed Assets,$$2,900,,$$$2,900,],[$Inventory$,$$$500,-4\mathrm{.}00\%,$$$480,],[$Receivables$,$$$300,,$$$300,],[$Total$,$$$4,000,,$$$3,980,],[\backslash$table$[[$Income and$],[$Expenses$]]],[$Sales Revenue,$$5,000,,$$$5,000,],[$Labor$,$$$700,,$$$700,],[$Materials$,$$$2,300,-5\mathrm{.}00\%,$$$2,185,],[$Overhead$,$$$800,,$$$800,],[$Gross Margin,$$1,200,,$$$1,315,],[$Other Revenue,$$10,,$$$10,],[$Other Expenses,$$800,,$$$800,],[$Net Income,$$410,,$$$525,],[,,,$Change$],[$ROA$,10\mathrm{.}25\%,,13\mathrm{.}19\%,28\mathrm{.}69\%$ Your firm is reporting the financial information shown in Figure $2\mathrm{.}3$ to its shareholders. To better understand the expected financial impact of potential projects, the firm has asked you to set up a spreadsheet that has the data shown in Figure $2-3.$ Use this spreadsheet to answer the following questions:

a$)$ Replicate the calculations shown in Figure $2-3.$ Make sure that a reduction of materials by $5\%$ and inventory by $4\%$ results in a $28\mathrm{.}89\%$ change in return on assets, a $28\mathrm{.}05\%$ change in profit margin, and a $0\mathrm{.}50\%$ change in asset turnover. Does your spreadsheet show the same results?

b$)$ Your firm is considering a project where a major assembly would be out$-$sourced. You estimate that this project would reduce labor cost by $4\%$ but increase material cost by $1\%.$ Further, you expect that you could reduce your fixed assets by about $10\%.$ Starting from the $$original$$ financial data, what would be the impact of this project on your firm$$s performance measures? $($Copy the calculations done in $$Part a$$ to a new $$Part b$$ tab and do these calculations there c$)$ Management has challenged you to develop a project that will increase ROA by $2\%.$ You can only focus on a single Operating Expense. What would you focus on and how much would you target reducing the account to get exactly the $2\%$ improvement in ROA? $($Show your result in a $$Part c$$ tab.$)$