Cola Company and Pop Company both produce and market beverages that are direct competitors. Key financial figures for these businesses for a recent year follow: Key Figures ($ millions) Cola Company Pop Company Sales $ 45,660 $ 65,072 Net income 9,300 7,107 Average assets 75,000 69,000 Required: 1. Compute return on assets for Cola Company and Pop Company. (Enter values in $ millions.)
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Return on assets :
Return on assets is a financial ratio that indicates how profitable a company is in relation to its total assets.
Formula :
Return on assets =Net Income / Average total assets
Where,
Average total assets = (total assets, beginning + total assets, ending) / 2
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- Coca-Cola and PepsiCo both produce and market beverages that are direct competitors. Key financialfigures for these businesses for a recent year follow.Key Figures ($ millions) Coca-Cola PepsiCoSales . $46,542 $66,504Net income . 8,634 6,462Average assets . . . . . . . . . . . . . . . . . . . . 76,448 70,518Required Compute return on assets for (a) Coca-Cola and (b) PepsiCo.Coca-Cola and PepsiCo both produce and market beverages that are direct competitors. Key financialfigures for these businesses for a recent year follow.Key Figures ($ millions) Coca-Cola PepsiCoSales . $46,542 $66,504Net income . 8,634 6,462Average assets . . . . . . . . . . . . . . . . . . . . 76,448 70,518Required Which company is more successful in returning net income from its assets invested?Coca-Cola and PepsiCo both produce and market beverages that are direct competitors. Key financialfigures for these businesses for a recent year follow.Key Figures ($ millions) Coca-Cola PepsiCoSales . $46,542 $66,504Net income . 8,634 6,462Average assets . . . . . . . . . . . . . . . . . . . . 76,448 70,518Required Which company is more successful in its total amount of sales to consumers?
- Coca-Cola and PepsiCo both produce and market beverages that are direct competitors. Key financialfigures for these businesses for a recent year follow.Key Figures ($ millions) Coca-Cola PepsiCoSales . $46,542 $66,504Net income . 8,634 6,462Average assets . . . . . . . . . . . . . . . . . . . . 76,448 70,518Required Write a one-paragraph memorandum explaining which company you would invest your money in and why. (Limit your explanation to the information provided.)Selected data from the Florida Fruit Company are presented below: Total assets $1,500,000 Average totalassets 1,850,000 Net income 175,000 Net sales 1,300,000 Average commonstockholders’ equity 1,000,000 Net cash providedby operating activities 275,000 Instructions Assuming that no dividends were declared or paid during the period, calculate the following profitability ratios from the above information: 1. Profit margin 2. Asset turnover 3. Return on assets4. Return on common stockholdersSelected data from the Florida Fruit Company are presented below: Total assets $1,500,000 Average total assets 1,850,000 Net income 175,000 Net sales 1,300,000 Average commonstockholders’ equity 1,000,000 Net cash providedby operating activities 275,000 Instructions Assuming that no dividends were declared or paid during the period, calculate the following profitability ratios from the above information: 1. Profit margin 2. Asset turnover 3. Return on assets4. Return on common stockholders’ equity
- Comparative financial statement data for Monty Corp. and Sheffield Corp., two competitors, appear below. All balance sheet data are as of December 31, 2022. Monty Corp. Sheffield Corp. 2022 2022 Net sales $ 1,944,000 $ 669,600 Cost of goods sold 1,269,000 367,200 Operating expenses 305,640 105,840 Interest expense 10,360 4,680 Income tax expense 91,800 38,880 Current assets 429,600 196,560 Plant assets (net) 575,400 150,940 Current liabilities 71,600 36,400 Long-term liabilities 117,340 44,220 Net cash common by operating activities 149,040 38,880 Capital expenditures 97,200 21,600 Dividends paid on common stock 38,880 16,200 Weighted-average common shares outstanding 80,000 50,000 (a)Compute the net income and earnings per share for each company for 2022. (Round Earnings per share to 2 decimal places, e.g. $2.78.) Net Income Earnings per share…Here are comparative financial statement data for Sandhill Company and Wildhorse Company, two competitors. All data are as of December 31, 2022, and December 31, 2021. Sandhill Company Wildhorse Company 2022 2021 2022 2021 Net sales $1,872,000 $559,000 Cost of goods sold 1,100,736 297,388 Operating expenses 263,952 79,378 Interest expense 9,360 4,472 Income tax expense 54,288 6,149 Current assets 326,000 $314,500 83,500 $78,600 Plant assets (net) 519,600 497,900 141,000 125,100 Current liabilities 66,000 75,800 36,600 29,800 Long-term liabilities 107,800 91,600 30,400 25,600 Common stock, $10 par 498,000 498,000 122,500 122,500 Retained earnings 173,800 147,000 35,000 25,800 (a) Prepare a vertical analysis of the 2022 income statement data for Sandhill Company and Wildhorse Company. (Round percentages…[The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. BarcoCompany KyanCompany BarcoCompany KyanCompany Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 770,000 $ 914,200 Cash $ 21,000 $ 34,000 Cost of goods sold 587,100 642,500 Accounts receivable, net 34,400 59,400 Interest expense 9,100 17,000 Merchandise inventory 84,940 132,500 Income tax expense 14,800 25,238 Prepaid expenses 5,400 7,350 Net income 159,000 229,462 Plant assets, net 310,000 307,400 Basic earnings per share 3.79 5.08 Total assets $ 455,740 $ 540,650 Cash dividends per share 3.82 4.01 Liabilities and Equity Beginning-of-year balance sheet data Current…
- The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. BarcoCompany KyanCompany BarcoCompany KyanCompany Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 770,000 $ 914,200 Cash $ 21,000 $ 34,000 Cost of goods sold 587,100 642,500 Accounts receivable, net 34,400 59,400 Interest expense 9,100 17,000 Merchandise inventory 84,940 132,500 Income tax expense 14,800 25,238 Prepaid expenses 5,400 7,350 Net income 159,000 229,462 Plant assets, net 310,000 307,400 Basic earnings per share 3.79 5.08 Total assets $ 455,740 $ 540,650 Cash dividends per share 3.82 4.01 Liabilities and Equity Beginning-of-year balance sheet data Current…You have the following financial statements for two building companies and have been asked to compare them: Income statements for the year to 31st December 2019 Rachel Ltd Ronald Ltd £`000 £`000 Sales 2500 3600 Cost of Sales (450) (600) Gross Profit 2050 3000 Operating expenses (150) (350) Operating Profit 1900 2650 Interest Payable (40) (56) Profit Before Taxation 1860 2594 Taxation (68) (75) Profit After Taxation 1792 2519 Dividends (30) (43) Retained Profits 1762 2476 Statements of financial position as at 31st December 2019 Rachel Ltd Ronald Ltd £`000 £`000 Non-current assets 3056 3868 Current assets Inventories 70 35 Trade receivables 200 260 Cash at bank 56 20 Less: Current liabilities Trade payables (70) (65) Taxation (50) (42)…You have the following financial statements for two building companies and have been asked to compare them: Income statements for the year to 31st December 2019 Rachel Ltd Ronald Ltd £`000 £`000 Sales 2500 3600 Cost of Sales (450) (600) Gross Profit 2050 3000 Operating expenses (150) (350) Operating Profit 1900 2650 Interest Payable (40) (56) Profit Before Taxation 1860 2594 Taxation (68) (75) Profit After Taxation 1792 2519 Dividends (30) (43) Retained Profits 1762 2476 Statements of financial position as at 31st December 2019 Rachel Ltd Ronald Ltd £`000 £`000 Non-current assets 3056 3868 Current assets Inventories 70 35 Trade receivables 200 260 Cash at bank 56 20 Less: Current liabilities Trade payables (70) (65) Taxation (50) (42)…