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Consider the following financial information for the companies below . Assume all assets are used solely for operations and a ll liabilities to be interest-bearing.

Consider the following financial information for the companies below. Assume all assets are used solely for operations and all liabilities to be interest-bearing.

Wayne Enterprises ($)

Luthor Corp ($)

Total Assets

15,000,000

10,000,000

Total Equity

10,000,000

5,000,000

Interest Expense

280,000

500,000

Net Income

850,000

1,200,000

Revenue

8,200,00

14,185,000

Required: Calculate the ratios for each company using the template provided in the next two pages. Decompose the ROE into its individual components using both the traditional and alternative approaches covered in weeks 4 & 5 of lectures. Ignore tax effects.

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