Po- Yen Devices Inc. and Kejia Computer Ltd. are competing businesses. Selected data from the financial statements for the two companies for the year ended 31 December 20X2 are shown below.

Required:
1. Compute the following ratios for both companies (for convenience, use 20X2 year- end balance sheet amounts instead of averages):
a. Operating margin (i. e., earnings ÷ revenue)
b. Return on assets
c. Return on share equity
d. Total debt- to- shareholder€™s equity
2. Evaluate the two companies, based on the ratios you have calculated. Which company do you think is moreprofitable?

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Po-Yen Devices Kejia Year ended 31 December 20X2 in thousands of Canadian dollars) Sales revenue Earnings from continuing operations, net of income tax Net earnings, after income taxes Comprehensive income Current assets Tangible capital assets, net Total assets Current liabilities Long-term liabilities Common shares Retained earnings Total liabilities and shareholders' equity Number of common shares outstanding (thousands) Computer $540,000 $270,000 23,000 23,000 72,000 16,000 $260,000 $110,000 40,000 60,000$150,000 $120,000 60,000 80,000 66,000 400,000 $6 360,000 100,000 80,000 50,000 40,000 $660,000 $150,000 250,000 300,000