Below is the financial information for Nike, Inc. and Adidas AG for the fiscal year 2022:

($ millions)	Nike, Inc.	Adidas AG
Net sales	$50,074	$26,324
Cost of sales	27,241	13,578
Gross profit	22,833	12,746
Operating expenses:
Selling, general, and administrative (SG&A)	10,548	7,321
Research and development (R&D)	3,198	1,619
Operating income	9,087	3,806
Interest and other (income) expense	1,102	639
Interest and investment income	(435)	(307)
Earnings before provision for income taxes	8,420	3,474
Provision for income taxes	2,147	838
Net earnings	$6,273	$2,636

Required:

1. Calculate the return on equity (ROE), return on assets (ROA), and return on financial leverage (ROFL) for each company in fiscal year 2022. Assume a tax rate of 25%.
2. Disaggregate the ROA into profit margin (PM) and asset turnover (AT) components. Identify which factor drives the ROA for each company.
3. Analyze the trend in SG&A expenses over the past five years. How does it impact each company’s operational efficiency?
4. Evaluate the current ratio and quick ratio for Nike, Inc. and Adidas AG. What does it reveal about their short-term liquidity?
5. Compare the research and development (R&D) expenses as a percentage of sales for Nike, Inc. and Adidas AG. What insights can be drawn about their investment in innovation?