determine the following ratios for both companies, then based on the information analvze and compare the two companies' solvency and profitability. Ratios: Return on total assets Return on stockholders' equity Times interest earned Ratio of total liabilities to stockholders' equity.
determine the following ratios for both companies, then based on the information analvze and compare the two companies' solvency and profitability. Ratios: Return on total assets Return on stockholders' equity Times interest earned Ratio of total liabilities to stockholders' equity.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 4MAD: Marriott International, Inc. (MAR), and Hyatt Hotels Corporation (H) are two major owners and...
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determine the following ratios for both companies, then based on the information analvze and compare the two companies' solvency and profitability.
Ratios:
Return on total assets
Return on stockholders' equity
Times interest earned
Ratio of total liabilities to stockholders' equity.
Transcribed Image Text:Marriott International, Inc., and Hyatt Hotels Corporation are
two major owners and managers of lodging and resort properties
in the United States. Abstracted income statement information
for the two companies is as follows for a recent year (in millions):
Operating profit before other expenses and Interest
Other revenue
Interest expense
Income before Income tax expense
Income tax expense
Net Income
Balance sheet information is as follows:
Total liabilities
Total stockholders' equity
Total liabilities and stockholders' equity
Marriott
$2,366
319
(340)
$2,345
438
$1,907
Average total liabilities
Average total stockholders' equity
Average total assets
Marriott
$21,471
2,225
$23,696
Marriott
$20,868
2,903
23,771
Hyatt
$332
695
(76)
$951
182
$769
Hyatt
$3,966
The average liabilities, average stockholders' equity, and average total assets are as follows:
Hyatt
$3,848
3,760
7,608
3,677
$7,643
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