Balance sheets and income statements for 3M Company follow:

Consolidated Statements of Income For Year Ended Dec. 31 ($ Millions) 2012 2011 2010 Net Sales $29,904 $29,611 $26,662 Operating Expenses Cost of sales 15,685 15,693 13,381 Selling, general and administrative expenses 6,102 6,170 5,479 Research, development and related expenses 1,634 1,570 1,434 Total operating expenses 23,421 23,433 20,744 Operating income 6,483 6,178 5,918 Interest expense and income Interest expense 171 186 201 Interest income (39) (39) (38) Total interest expense net 132 147 163 Income before income taxes 6,351 6,031 5,755 Provision for income taxes 1,840 1,674 1,592 Net income including noncontrolling interest $4,511 $4,357 $4,163 Less: Net income attributable to noncontrolling interest 67 74 78 Net income attributable to 3M $4,444 $4,283 $4,085 Consolidated Balance Sheets At December 31 ($ Millions, except per share amount) 2012 2011 Assets Current Assets Cash and cash equivalents $2,883 $2,219 Marketable securities - current 1,648 1,461 Accounts receivable - of allowances of $105 and $108 4,061 3,867 Inventories Finished goods 1,754 1,536 Work in process 1,186 1,061 Raw materials and supplies 897 819 Total inventories 3,837 3,416 Other current assets 1,201 1,277 Total current assets 13,630 12,240 Marketable securities - noncurrent 1,162 896 Investments 163 155 Property, plant and equipment 22,525 21,165 Less: Accumulated depreciation (14,147) (13,500) Property, plant and equipment - net 8,378 7,665 Goodwill 7,385 7,047 Intangible assets - net 1,925 1,916 Prepaid pension benefits 16 40 Other Assets 1,217 1,656 Total Assets $33,876 $31,616 Liabilities Current Liabilities Short-term borrowing and current portion of long-term debt $1,085 $682 Accounts payable 1,762 1,643 Accrued payroll 701 676 Accrued income taxes 371 355 Other current liabilities 2,281 2,085 Total current liabilities 6,200 5,441 Long-term debt 4,916 4,484 Pension and postretirement benfits 3,086 3,972 Other liabilities 1,634 1,857 Total liabilities $15,836 $15,754 Equity 3M Company shareholders' equity: Common stock, par value $0.01 per share; Shares outstanding - 2012: 687,091,650 Shares outstanding - 2011: 694, 970,041 $9 $9 Additional paid-in capital 4,044 3,767 Retained Earnings 30,679 28,348 Treasury stock (12,407) (11,679) Accumulated other comprehesive income (loss) (4,750) (5,025) Total 3M Company shareholders' equity 17,575 15,420 Noncontrolling interest 465 442 Total equity 18,040 15,862 Total liabilities and equity 33,876 31,616

A) Compute net operating profit after tax (NOPAT) for 2012. Assume that the combined federla and state statutory tax rate is 37%.

B) Compute net operating assets (NOA) for 2012 and 2011. Treat noncurrent investments as a nonoperating item.

C) Compute and disaggregate 3M's RNOA into net operating profti margin (NOPM) and net operating asset turnover (NOAT) for 2012. Demonstrate that RNOA = NOPM x NOAT.

D) Compute net nonoperating obligation (NNO) for 2012 and 2011. Confirm the relation: NOA = NNA + Stockholders' equity.

E) Compute return on equity (ROE) for 2012.

F). What is the nonoperating return component of ROE for 2012?

G) Comment on the difference btween ROE and RNOA. What inference can we draw from this comparison? *** Show ALL work to be voted best answer ***