Yum! Brands, Inc. (YUM) is a worldwide operator and franchisor of fast-food restaurants, under the familiar brands of KFC, Pizza Hut, and Taco Bell. Segment revenues, operating income, and depreciation and amortization expense for Yum!’s operating segments are provided for a recent year as follows (in millions):

a. Prepare a vertical analysis of the sales as a percent of total sales for the three segments. Round percentages to the nearest whole percent. Which segment has the greatest percentage of total sales?

b. Determine the earnings before interest, taxes, depreciation, and amortization (EBITDA) for the three segments.

c. Determine the EBITDA as a percent of sales (EBITDA margin) for the three segments. Round percentages to the nearest whole percent.

d. Interpret the analysis in (c).

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Depreciation and Amortization Expense $173 Operating Income Sales $3,232 1,111 2,025 Segment KFC Pizza Hut Taco Bell $874 370 593 36 91