Income statements for American Airlines Group Inc. and Delta Air Lines, Inc. for the fiscal year 2022 are as follows:

($ millions)	American Airlines Group Inc.	Delta Air Lines, Inc.
Net sales	$45,768	$49,634
Cost of sales	32,499	34,674
Gross profit	13,269	14,960
Operating expenses:
Selling, general, and administrative (SG&A)	6,734	7,312
Research and development (R&D)	1,453	1,672
Operating income	5,082	5,976
Interest and other (income) expense	1,712	1,764
Interest and investment income	(538)	(584)
Earnings before provision for income taxes	3,908	4,796
Provision for income taxes	782	960
Net earnings	$3,126	$3,836

Required:

1. Compute 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. Assess the trend in SG&A expenses over the past five years. What does it indicate about each company’s operational efficiency?
4. Evaluate the current ratio and quick ratio for American Airlines Group Inc. and Delta Air Lines, Inc. What does it reveal about their short-term liquidity?
5. Compare the net profit margins of American Airlines Group Inc. and Delta Air Lines, Inc. What insights can be drawn about their profitability?