A firm has been experiencing low profitability in recent years. Perform an analysis of the firm's financial position using the DuPont equation. The firm has no lease payments but has a $3 million sinking fund payment on its debt. The most recent industry average ratios and the firm's financial statements are as follows:

Industry Average Ratios
Current ratio	2			Fixed assets turnover	7
Debt-to-capital ratio	14	%		Total assets turnover	4
Times interest earned	3			Profit margin	4.75	%
EBITDA coverage	6			Return on total assets	19.00	%
Inventory turnover	11			Return on common equity	20.10	%
Days sales outstandinga	17	days		Return on invested capital	17.70	%
aCalculation is based on a 365-day year.

Balance Sheet as of December 31, 2021 (millions of dollars)
Cash and equivalents	$	64		Accounts payable	$	40
Accounts receivables		50		Other current liabilities		17
Inventories		111		Notes payable		27
Total current assets	$	225		Total current liabilities	$	84
				Long-term debt		13
				Total liabilities	$	97
Gross fixed assets		171		Common stock		80
Less depreciation		61		Retained earnings		158
Net fixed assets	$	110		Total stockholders' equity	$	238
Total assets	$	335		Total liabilities and equity	$	335

Income Statement for Year Ended December 31, 2021 (millions of dollars)
Net sales	$	715.00
Cost of goods sold		570.00
Gross profit	$	145.00
Selling expenses		79.50
EBITDA	$	65.50
Depreciation expense		14.00
Earnings before interest and taxes (EBIT)	$	51.50
Interest expense		6.50
Earnings before taxes (EBT)	$	45.00
Taxes (25%)		11.25
Net income	$	33.75

1. Calculate the following ratios. Do not round intermediate calculations. Round your answers to two decimal places.

   	Firm	Industry Average
   Current ratio		2
   Debt to total capital		14	%
   Times interest earned		3
   EBITDA coverage		6
   Inventory turnover		11
   Days sales outstanding		17	days
   Fixed assets turnover		7
   Total assets turnover		4
   Profit margin		4.75	%
   Return on total assets		19.00	%
   Return on common equity		20.10	%
   Return on invested capital		17.70	%

2. Construct a DuPont equation, and the industry. Do not round intermediate calculations. Round your answers to two decimal places.

   	Firm	Industry
   Profit margin		4.75%
   Total assets turnover		4
   Equity multiplier