Electronic Arts, Inc. (commonly know as EA Sports) develops, markets, and publishes electronic games. Union Pacific Corporation

Question:

Electronic Arts, Inc. (commonly know as EA Sports) develops, markets, and publishes electronic games. Union Pacific Corporation is one of the largest railway networks in the nation, with 32,122 miles of railroads. The following data were taken from one of the companies’ December 31, 2017, annual reports.

Revealing which data relate to which company was intentionally omitted. The dollar amounts are in millions.

Company 1 Company 2 Sales $21,240 $5,150 Depreciation costs Net earnings 2,105 136 1,043 6,004 10,712 Current assets 4,006 51,605 Property, plant, and equipment Total assets 453 57,806 8,584


Required

a. Calculate depreciation costs as a percentage of sales for each company.

b. Calculate property, plant, and equipment as a percentage of total assets for each company.

c. Based on the information now available to you, decide which data relate to which company. Explain the rationale for your decision.

d. Which company appears to be using its assets most efficiently? Explain your answer.

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Related Book For  book-img-for-question

Introductory Financial Accounting For Business

ISBN: 9781260575309

2nd Edition

Authors: Thomas Edmonds, Christopher Edmonds, Mark Edmonds, Jennifer Edmonds, Philip Olds

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