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Question 7 Summarised statements offinancial position and other nancial information for Ballarat Ltd and Bendigo Ltd are presented below. Both companies own and operate retail shops in Victoria. Statements oil'financial position as at 30/16/211 .' Ballarat Ltd Bendigo Ltd $ $ Current assets 420,000 472,000 Non-current assets 677,000 628,000 Total assets 1,097,000 1,100,000 Current liabilities 101,000 218,000 Non-current liabilities 191,000 420,000 Ordinary shareholders' equity 805,000 462,000 Total liabilities and shareholders' equity 1,097,000 1,100,000 Other informationfor the year ending 30/6/21 : Sales 963,000 958,000 Cost of good sold 645,000 640,000 Interest expense 30,000 52,000 Income tax expense 66,000 61,000 Prot after income tax 153,000 143,000 A friend of yours is undertaking an analysis of these two companies. Included in the analysis are the following two ratios (it may be assumed that these have been calculated correctly): Ballarat Ltd Bendigo Ltd Return on owners' equity 19% 31% Return on assets 23% 23% Required Your friend made the following comment: \"i cannot understand now two companies can have the same return on total assets but completely different rates of'retarn on owners ' equity '. Using any additional calculations you think are necessary, explain the situation to your friend. (10 marks)

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