The following selected data were taken from the financial statements of Vidahill Inc. for December $31,20$Y$7,20$Y$6,$ and $20$Y$5$:

December $31$

$20$Y$720$Y$620$Y$5$

Total assets $$241,000$ $$217,000$ $$193,000$

Notes payable $(8\%$ interest$)80,00080,00080,000$

Common stock $32,00032,00032,000$

Preferred $4\%$ stock, $$100$ par $16,00016,00016,000$

$($no change during year$)$

Retained earnings $89,91061,91048,000$

The $20$Y$7$ net income was $$28,640,$ and the $20$Y$6$ net income was $$14,550.$ No dividends on common stock were declared between $20$Y$5$ and $20$Y$7.$ Preferred dividends were declared and paid in full in $20$Y$6$ and $20$Y$7.$

a$.$ Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders$$ equity for the years $20$Y$6$ and $20$Y$7.$ Round percentages to one decimal place.

$20$Y$720$Y$6$

Return on total assets fill in the blank $1$

$\%$ fill in the blank $2$

$\%$

Return on stockholders$$ equity fill in the blank $3$

$\%$ fill in the blank $4$

$\%$

Return on common stockholders$$ equity fill in the blank $5$

$\%$ fill in the blank $6$

$\%$

b$.$ The profitability ratios indicate that the company's profitability has

improved

$.$ Since the rate of return on total assets is

less than

the return on stockholders' equity in both years, there must be

positive

leverage from the use of debt.