1. Exhibit 10.13 presents historical data for ShipCo, a manufacturer of ships. how has ShipCo performed oinvested capital)? What is Based on the data, how has ShipCo performed over the past five years? What is its ROIC for years 2 to 5 (using average invested capital)? What is its operating margin? What is its capital turnover? Is it creating more or less value over time? Assume an operating tax rate of 30 percent and cost of capital of 9 percent. EXHIBIT 10.13 ShipCo: Income Statement and Balance Sheet $ million Year Year Year Year Year Year Year Year Year Year Income statement Revenues 2 5 Balance sheet 2 530.0 556.5 601.0 661.1 674.3 Operating cash 0.6 11 12.0 13.2 13.5 Excess cash and marketable Cost of sales Selling, general, and 344.5) (364.5) (396.7) (439.6) (451.8 securities 02.8 108.9 111.2 118.2 139.8 administrative (79.5) (863) (87.1) (92.6) (107.9) Accounts receivable 79.5 807 93.2 99.2 97.8 Depreciation EBIT Interest expense Gain (loss) on sale 15.9 16.7) 18.0 9. (20.2) Inventory 0 89.0 99.2 109. 944Current assets 7.5) (7.5) 7. 7.5 (7.5) 69.6 183.6 204.3 231.4 242.8 62.5 384.3 420.7 462.0 493.8 Property, plant, and of assets Eanings before (10.0) equipment 206.7 219.8 240.4 267.8 276.5 taxes Taxes Net income 2.6 71.5 91.7 101.6 86.9 Equity investments 180.0 180.0 100 180.0 1800 24.8) (21.5) 27.5 30.5) (26.1) 7.8 50. 64.2 71.1 60.8 Total assets 749.2 784.2 84 909.8 950.3 Dividends 7.3 170 18.0 78 18.3 Accounts payable 116.6 119.6 126.2 135.5 134.9 5.0 45.0 45.0 45.0 45.0 0.1 89.0 3.2 99.2 97.8 Current liabilities 2517 253.7 264.4 279.7 277.6 m debt expenses Go to page 309 Long-term debt Common stock 105.0 105.0 105.0 105.0 105.0 100.0 100.0 100.0 100.0 100.0 Retained earnings 292.5 325.5 371.7 425.1 467.6 Total liabilities and equity 749.2 784.2 841.1 909.8 950.3 2. Using the data presented in Question 1, decompose operating margin and capital turnover. What has been occurring at ShipCo over the five-year period? What might be driving these results