And, according to my understanding of the DuPont equation and its calculation of ROE, the three ratios provide insights into the companys (use of debt versus equity financing or management of its sales and share price)............... , effectiveness in using the companys assets, and(management of its liquidity and its tax records or control over its expenses).................................

Balance Sheet Data Income Statement Data Cash Accounts receivable Inventory $1,200,000 Accounts payable $1,440,000 Sales $24,000,000 12,000,000 12,000,000 6,000,000 6,000,000 720,000 5,280,000 1,848,000 $3,432,000 2,400,000 Accruals 3,600,000 Notes payable 7,200,000 480,000Cost of goods sold 1,920,000 Gross profit 3,840, 4,080,000 EBIT 7,920,000 Interest expense 1,620,000 EBT 4,860,000 Taxes 6,480,000 Net income Current assets Current liabilities 000 Operating expenses Long-term debt Total liabilities Common stock Net fixed assets 7,200,000 Retained earnings Total equity Total debt and equity Total assets $14,400,000 $14,400,000 If I remember correctly, the DuPont equation breaks down our ROE into three component ratios: the net profit margin , the total asset turnover ratio, and the equity multiplier And, according to my understanding of the DuPont equation and its calculation of ROE, the three ratios provide insights into the company's , effectiveness in using the company's assets, and Now, let's see your notes with your ratios, and then we can talk about possible strategies that will improve the ratios. I'm going to check the box to the side of your calculated value if your calculation is correct and leave it unchecked if your calculation is incorrect. Hydra Cosmetics Inc. DuPont Analysis Check if Correct Check if Ratios Profitability ratios Gross profit margin (%) Operating profit margin (%) Net profit margin(%) Return on equity (%) Value Ratios Value Correct Asset management ratio Total asset turnover 50.00 22.00 23.83 72.43 1.67 Financing ratios Equity multiplier 1.82