ompute, Disaggregate, and Interpret RNOA of Competitors Halliburton and Schlumberger compete in the oil field services sector. Refer to the following 2018 financial data for the two companies to answer the requirements. $ millions HAL SLB Total revenue $24,679 $33,499 Pretax net nonoperating expense 1,337 1,110 Net income 2,341 2,861 Average operating assets 24,045 68,520 Average operating liabilities 6,572 17,183 Marginal tax rate 22% 19% Return on equity 18.56% 5.86% a. Compute return on net operating assets (RNOA) for each company. Note: 1. Select the appropriate numerator and denominator used to compute RNOA from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute RNOA. Company Numerator Denominator RNOA Answer Answer HAL Answer Answer SLB Answer Answer b. Disaggregate RNOA into net operating profit margin (NOPM) and net operating asset turnover (NOAT) for each company. Note: 1. Select the appropriate numerator and denominator used to compute NOPM from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute NOPM. Company Numerator Denominator NOPM Answer Answer HAL Answer Answer SLB Answer Answer Note: 1. Select the appropriate numerator and denominator used to compute NOAT from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute NOAT. Company Numerator Denominator NOAT Answer Answer HAL Answer Answer SLB Answer Answer

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter12: Fainancial Statement Analysis

Section: Chapter Questions

Problem 90PSB

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Compute, Disaggregate, and Interpret RNOA of Competitors

Halliburton and Schlumberger compete in the oil field services sector. Refer to the following 2018 financial data for the two companies to answer the requirements.

$ millions	HAL	SLB
Total revenue	$24,679	$33,499
Pretax net nonoperating expense	1,337	1,110
Net income	2,341	2,861
Average operating assets	24,045	68,520
Average operating liabilities	6,572	17,183
Marginal tax rate	22%	19%
Return on equity	18.56%	5.86%

a. Compute return on net operating assets (RNOA) for each company.

Note: 1. Select the appropriate numerator and denominator used to compute RNOA from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute RNOA.

Company	Numerator	Denominator
	Answer	Answer
HAL	Answer	Answer
SLB	Answer	Answer

b. Disaggregate RNOA into net operating profit margin (NOPM) and net operating asset turnover (NOAT) for each company.

Note: 1. Select the appropriate numerator and denominator used to compute NOPM from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute NOPM.

Company	Numerator	Denominator
	Answer	Answer
HAL	Answer	Answer
SLB	Answer	Answer

Note: 1. Select the appropriate numerator and denominator used to compute NOAT from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute NOAT.

Company

Numerator

Denominator

NOAT

Answer

HAL

Answer

SLB

Answer

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