Exercise 15-11 Financial Ratios for Assessing Profitability and Managing Debt [LO15-4, LO15-5] Selected financial data from the June 30 year-end statements of Safford Company are given below: Total assets Long-term debt (12% interest rate) Total stockholders' equity Interest paid on long-term debt Net income $5,600,000 $ 640,000 $2,300,000 76,800 400,000 Total assets at the beginning of the year were $5,400,000; total stockholders' equity was $2,100,000. The company's tax rate is 30%, Required 1. Compute the return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 2. Compute the return on equity. (Round your percentage answer to 1 decimal place (i.e., 01234 should be entered as 12.3).) 3. Is financial leverage positive or negative? 1. Return on total assets 2. Return on equity 3. Financial Leverage