The following information is available on the Canadian Fire company inc. :

Current assets: $200,000

Fixed assets: $300,000

Turnover of total assets: 4 times

Net profit: $60,000

Ratio of total liabilities to total assets: 20%

Tax rate: 40%

A) Determine the net sales margin, return on total assets (ROA), and profitability of shareholder equity (ROE or RFP).

B) All things being equal, if the company increases its fixed assets by 100,000 dollars and increases its net margin on sales to 5%, what will be the new rate of return of shareholders' equity?