Attempts: Keep the Highest: /32 9. An analysis of company performance using DuPont analysis Aa Aa A sheaf of papers in his hand, your friend and colleague, Akira, steps into your office and asked the following. Akira Do you have 10 or 15 minutes that you can spare? You Sure, I've got a meeting in an hour, but I don't want to start something new and then be interrupted by the meeting, so how can I help? Akira I've been reviewing the company's financial statements and looking for ways to improve our performance, in general, and the company's return on equity, or ROE, in particular. Emma, my new team leader, suggested that I start by using a DuPont analysis, and I'd like to run my numbers and conclusions by you to see whether I've missed anything Here are the balance sheet and income statement data that Emma gave me, and here are my notes with my calculations Could you start by making sure that my numbers are correct? You Give me a minute to look at these financial statements and to remember what I know about the DuPont analysis. Cash Accounts receivable ventory Current assets Balance Sheet Data $800,000 Accounts payable 1,600,000 Accruals 2,400,000 Notes payable 4,800,000 Current liabilities Long-term debt Total liabilities Common stock 4,800,000 Retained earnings Total equity $9,600,000 Total debt and equity $960,000 320,000 1,280,000 2,560,000 3,200,000 5,760,000 960,000 2,880,000 3,840,000 $9,600,000 Income Statement Data Sales $16,000,000 Cost of goods sold 8,000,000 Gross pront 8,000,000 Operating expenses 4,000,000 EBIT 4,000,000 Interest expense 537,600 3,462,400 Taxes 1,211,840 Net income $2,250,560 Net fixed assets Total assets If I remember correctly, the DuPont equation breaks down our ROE into three component ratios: the , the total asset turnover ratio, and the 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