In the special case where the investor company is liable for the debts of the investee, the analyst can adjust the data by adding the financial items of the investor with those of the equity method investees and then recalculate key ratios as follows. Assume a tax rate of 30%, and a 50% equity method investee.

	Investor	Investee
Revenue	$17,100	$8,400
Operating expenses	13,620	7,000
Income from investment, net of tax	385	-
Operating profit	3,095	1,400
Interest expense	240	300
Pretax income	2,855	1,100
Tax expense	?	330
Net income	$ ?	$ 770

	Investor	Investee
Cash	$ 1,200	$ 200
Investment (50%*[$8,000 - $5,000]) = $1,500	1,500	0
Operating assets (excluding investment)	14,700	7,800
Total assets	$17,400	$8,000
Operating liabilities	$3,450	$ 600
Nonoperating liabilities	6,000	4,400
Total liabilities	9,450	5,000
Equity	7,950	3,000
Total liabilities and equity	$17,400	$8,000

I/S Adjustments	Investor	Adjustment	Adjusted
Revenue	?	?	?
NOPAT	?	?	?
Net nonoperating expense	?	?	?
Net income (NOPAT - Net nonoperating expense)	?	?	?

B/S Adjustments	Investor	Adjustment	Adjusted
NOA	?	?	?
NNO	?	?	?
Liabilities	?	?	?
Equity	?	?	?

Ratio Implications	Investor		Adjusted
RNOA (NOPAT/NOA)	?		?
NPOM (NOPAT/Revenue)	?		?
NOAT (Revenue/NOA)	?		?
ROE (NI/EQ)	?		?
Financial leverage (FLEV = NNO/EQ)	?		?

Required:

Use the set up in Analyst Adjustment 9.1 to calculate the missing numbers