7 Answer the questions below based on the following information Taxes are 35 percent and all dollars are in millions a Calculate each company 's ROE, ROA, and ROIC b Why is company Z 's ROE so much higher than X 's Does this mean Z is a better company Why or why not c Why is company X 's ROA higher...

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7. Answer the questions below based on the following information. Taxes are 35 percent and all dollars

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7. Answer the questions below based on the following information. Taxes are 35 percent and all dollars are in millions.

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a. Calculate each company's ROE, ROA, and ROIC.

b. Why is company Z's ROE so much higher than X's? Does this mean Z is a better company? Why or why not?

c. Why is company X's ROA higher than Z's? What does this tell you about the two companies?

d. How do the two companies' ROICS compare? What does this sug- gest about the two companies?

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Analysis for Financial Management

ISBN: 978-0073041803

8th edition

Authors: Robert c. Higgins

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Question Posted: Sep 21, 2024 09:01 AM

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7. Answer the questions below based on the following information. Taxes are 35 percent and all dollars

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Earnings before interest and taxes Debt (at 10% interest) Equity Company X $400 200 800 Company Z $ 420 1,200 300

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Analysis for Financial Management

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