Financial Analysis: Whitney Inc, CASE:
Whitney Inc. Balance Sheet
December 31, 2004

Total current liabilities $100
Long term debt 250
Common stockholders' equity 400
Total assets $750 Total liabilities and equity $750

Whitney Inc. Income Statement
for Year Ended December 31, 2004

Sales $1,000
Cost of goods sold (excluding depreciation) $550
Other operating expenses 100
Depreciation 50
Total operating costs 700
Earnings before interest and taxes (EBIT) $ 300
Interest expense 25
Earnings before taxes (EBT) $ 275
Taxes (40%) 110
Net income $ 165

With the above financial information, you must produce an analysis and report describeing what are Whitney Inc.'s basic earning power and ROA ratios?

a. 30%; 22% b. 40%; 30% c. 50%; 22% d. 40%; 22% e. 40%; 40%