Presented below are condensed financial statements adapted from those of two actual companies competing as the primary players in a specialty area of the food manufacturing and distribution industry. ($ in millions, except per share amounts.)

Balance Sheets
	Metropolitan				Republic
Assets
Cash	$	282.3			$	43.1
Accounts receivable (net)		513.7				416.0
Short-term investments						8.3
Inventories		562.4				719.2
Prepaid expenses and other current assets		216.6				576.7
Current assets	$	1,575.0			$	1,763.3
Property, plant, and equipment (net)		2,702.2				2,656.5
Intangibles and other assets		297.3				597.9
Total assets	$	4,574.5			$	5,017.7
Liabilities and Shareholders Equity
Accounts payable	$	572.9			$	781.2
Short-term notes		312.1				644.4
Accruals and other current liabilities		685.2				620.5
Current liabilities	$	1,570.2			$	2,046.1
Long-term debt		648.6				648.3
Deferred tax liability		474.6				703.7
Other long-term liabilities		215.0				193.1
Total liabilities	$	2,908.4			$	3,591.2
Common stock (par and additional paid-in capital)		229.9				440.0
Retained earnings		2,567.9				1,695.9
Less: Treasury stock		(1,131.7	)			(709.4	)
Total liabilities and shareholders equity	$	4,574.5			$	5,017.7
Income Statements
Net sales	$	5,794.0			$	7,856.2
Cost of goods sold		(2,818.0	)			(4,385.7	)
Gross profit	$	2,976.0			$	3,470.5
Operating expenses		(1,649.7	)			(2,933.2	)
Interest expense		(83.8	)			(43.6	)
Income before taxes	$	1,242.5			$	493.7
Tax expense		(295.7	)			(68.1	)
Net income	$	946.8			$	425.6
Net income per share	$	1.6			$	7.7

Evaluate and compare the two companies by responding to the following questions. Note: Because comparative statements are not provided you should use year-end balances in place of average balances as appropriate. Required: 1. For both companies, compute the ratios below. 2. Evaluate and compare the two companies.

Complete this question by entering your answers in the tabs below.

Required 1

Required 2

For both companies, compute the ratios below.

Complete this question by entering your answers in the tabs below.

Required 1

Required 2

For both companies, compute the ratios below.

	Metropolitan		Republic
Return on Assets (#.#)%		%		%
Profit Margin (#.#)%		%		%
Asset Turnover (#.##)		times		times
Return on Shareholders' Equity (#.#)%		%		%
Equity Multiplier (#.##)
Acid-Test Ratio (#.##)
Current Ratio (#.##)
Receivables Turnover (#.#)		times		times
Inventory Turnover (#.#)		times		times
Times Interest Earned (#.#)		times		times