Consider the following two companies:
(#s in $millions)	Company A	Company B
Sales	5,990	10,500
EBIT	600	1120
Interest	40	320
Earnings Before Tax	560	800
Taxes @ 40%	224	320
Net Income	336	480
Debt	400	3,200
Equity	1,600	800

Part (a) Calculate each company's ROE, ROA, and ROIC

Company A
ROE
ROA
ROIC

Company B
ROE
ROA
ROIC

Part (b)

Why is company Bs ROE so much higher than As? Does this mean B is a better company? Why or why not?

Hint: ROE = Profit Margin X Asset Turnover X Financial Leverage