Does anyone have any helpful suggestions for remembering the extended dupont. I understand the mechanics of the formula, but when I go to answer a question, I end up blanking… Any help would be appreciated. Good luck to all.

OK. This is how I do it. Remember: NSAE (N/S) * (S/A) * (A/E) Then we have to bring tax and interest into it [(EBIT/S) * (S/A) - (Int Exp/A)] * (A/E) *(1 - t) If you write it out on a piece of paper it looks less messy.

NI = (1-t) * (EBIT - Int Exp) NI/S = (1-t) *(EBIT - INT Exp)/S = (1-t) *(EBIT/S - INT Exp/S) ROE = (1-t) *(EBIT/S - INT Exp/S) *(S/A)*(A/E) =(1-t) *[EBIT/S*(S/A)- INT Exp/S*(S/A)] *(A/E) = [(EBIT/S) * (S/A) - (Int Exp/A)] * (A/E) *(1 - t) WHAT A MESS!

haha!