Refer to Rhodes Bakery At December 31,Year 1,the Company's Total Assets and Total Shareholders

question 128

Essay

Refer to Rhodes Bakery.Perform DuPont Analysis for Year 3 and Year 2,including the three components of return on equity (ROE).Round your answers to two decimal places,then comment on the company's relative ROE from Year 2 to Year 3.
Additional information is available below:
$\begin{array}{lrr}&\text { Year } 3 & \text { Year } 2\\\text { Total sales } & \$ 500,000 & \$ 410,000 \\\text { Net income } & \$24,000 & \$ 28,750\end{array}$
At December 31,Year 1,the company's total assets and total shareholders' equity were $325,000 and $287,500,respectively.

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Definitions:

Autonomic Nervous System

A division of the peripheral nervous system responsible for regulating involuntary body functions like heartbeat, blood flow, breathing, and digestion.

Effectors

Cells, tissues, or organs that perform a response or action as a result of neural or hormonal stimulation, notably muscles contracting and glands secreting.

GI Tract

The gastrointestinal tract, a continuous tube running through the body from mouth to anus, involved in the digestion and absorption of nutrients.

Parasympathetic

Pertaining to the division of the autonomic nervous system concerned with conserving energy and restoring the body to a restful state after exertion.