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please show your work , preferably in Excel. please note that this is a new edition and pertains to 2017. Thank you Compute return on

please show your work , preferably in Excel. please note that this is a new edition and pertains to 2017. Thank you

  1. Compute return on equity (ROE), return on assets (ROA), and return on financial leverage (ROFL) for each company in 2017. Assume 35% for those years.
  2. Disaggregate the ROAs computed into profit margin (PM) and asset turnover (AT) components. Which of these factors drives ROA for each company?
  3. Compute the gross profit margin (GPM) and operating expense-to-sales ratios for each company. How do these companies profitability measures compare?
  4. Compute the accounts receivable turnover (ART), inventory turnover (INVT), and property, plant, and equipment turnover (PPET) for each company. how do these companies turnover measures compare?
  5. Compare and evaluate these competitors performance in 2017.

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HOME DEPOT, INC. LOWES COMPANIES Balance Sheets Balance Sheets 2017 2016 2017 2016 $ 3,595 $ 2,538 $ $ 588 102 558 100 - 1,952 12,748 638 2,029 12,549 608 11,393 689 10,458 884 18,933 22,075 2.275 17.724 21.914 2,093 Analysis and Interpretation of Return on Investment for Competitors Balance sheets and income statements for The Home Depot, Inc., and Lowe's Companies, Inc., fol- low. Refer to these financial statements to answer the requirements. HOME DEPOT, INC. LOWE'S COMPANIES Balance Sheets Balance Sheets (5 millions) 2017 2016 2017 2016 Assets Current assets: Cash and cash equivalents $ 3,595 $ 2,538 $ 588 $ 558 Short-term investments 102 100 Receivables, net... 1,952 2,029 Merchandise inventories. 12,748 12,549 11.393 10,458 Other current assets. 638 608 689 884 Total current assets 18,933 17,724 12,772 12,000 Net property and equipment 22,075 21,914 19,721 19.949 Goodwill.... 2,275 2,093 1,307 1.082 Long-term investments, 408 366 Other assets 1.246 1.235 1,083 1,011 Total assets $44,529 $42,966 $35,291 $34,408 Liabilities and shareholders' equity Current liabilities: Short-term debt and current maturities of long-term debt. $ 2.761 $ 1.252 $ 1,431 $ 1,305 Accounts payable.. 7,244 7,000 6,590 6,651 related Accrued salaries and related expenses 1,640 1,484 747 790 Deferred revenue... 1,805 1,669 1,378 1,253 Income taxes payable. 54 25 Other current Habilities 2,690 2.703 1,950 1,975 Total current liabilities.......******* 16,194 14,133 12,096 11,974 Long-term debt, excluding current maturities 24,267 22,349 15,564 14,394 Deferred income taxes... 440 296 Other long-term liabilities 2,174 1,855 1,758 1,606 Total liabilities....... 43,075 38,633 29,418 27,974 Total stockholders equity 1,454 4,333 5,873 6,434 Total liabilities and shareholders' equity $44,529 $42,966 $35,291 $34,408 12,772 19,721 1,307 408 1,083 $35,291 12,000 19.949 1,082 366 1,011 1,246 1,235 $42,966 $44,529 $34,408 (s millions) Assets Current assets: Cash and cash equivalents Short-term investments Receivables, net... Merchandise inventories Other current assets. Total current assets Net property and equipment. Goodwill...en Long-term investments Other assets. Total assets Liabilities and shareholders' equity Current liabilities: Short-term debt and current maturities of long-term debt Accounts payable........... Accrued salaries and related expenses Deferred revenue .... Income taxes payable Other current liabilities Total current liabilities Long-term debt, excluding current maturities Deferred Income taxes Other long-term liabilities Total liabilities. ... Total stockholders' equity Total liabilities and shareholders' equity ***** $ 1,431 6,590 747 1.378 $ 1,305 6,651 790 1,253 1,950 1.975 S 2,761 7,244 1,640 1,805 54 2,690 16,194 24,267 440 2,174 43.075 1.454 $ 1,252 7.000 1,484 1,669 25 2.703 14,133 22,349 296 1,855 38,633 4,333 $42,966 12,096 15,564 11.974 14,394 1,758 29,418 5.873 1,606 27,974 6,434 $34,408 $44,529 $35,291

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