Return on Equity ratio under Finance Lease about, higher, return, finance, equity

irlfaan7

As we know, under the finance lease, return on equity is lower cos total expense is higher, so N.I is lower. How about the Equity side ? is it lower as well ? since N.I is lower => Retained earning is lower => shareholder equity is lower as well !

However, notes says Equity remains the same. why ?

Pls help !