Tootsie Roll Industries has two business segments, one for operations in the U.S. and one for operations
Question:
Tootsie Roll Industries has two business segments, one for operations in the U.S. and one for operations in Mexico and Canada. The information below (in thousands) comes from a recent annual report. Find the ROI for each segment for each year.
Instructions
Find and analyze segment ROI using the DuPont method described in this chapter. Explain the performance difference between the two segments across the two years by using the information from the DuPont breakdown of ROI. How does the fact that Tootsie Roll acquired a foreign-based company in August of Year 2 affect youranalysis?
Year 2 Year 1 United Mexico and United Mexico and States Canada Canada $387,280 $32,830 $362,373 $30,283 283,362 5,013 325 States Sales - Net assets293, Net earnings 58,098 1,174 618 69,230 65,385
Step by Step Answer:
Year 2 Year 1 United Mexico and United Mexico and States Canada States Canada Sales 38728...View the full answer
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078111044
16th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
Related Video
The Dupont analysis is an expanded return on equity formula, calculated by multiplying the net profit margin by the asset turnover by the equity multiplier. The DuPont analysis is also known as the DuPont identity or DuPont model.This Video will guide on how to calculate return on Equity and estimate profitability of shareholders using DuPont Analysis.
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