Based on the following information for KaoMin Corporation and the industry average, answer the following...
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Based on the following information for KaoMin Corporation and the industry average, answer the following questions. KaoMin Corporation 2020 2019 Equity Multiplier 1.75 1.85 Total Asset Turnover 2.18 2.34 Net Profit Margin (%) 0.058 0.049
Industry Average 2020 2019 Equity Multiplier 1.69 1.64 Total Asset Turnover 2.13 2.15 Net Profit Margin (%) 0.047 0.041
(i) Calculate Return on Equity (ROE) using Du Pont identity for KaoMin Corporation and the industry. (3 marks) (ii) Make your evaluation for KaoMin Corporation and the industry from 2019 to 2020 based on the three areas under DuPont analysis. Which area should KaoMin concern? (4 marks)
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