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Posted on Jul 15, 2024

Question 7 O pts Airlines Companies M and N are airline companies. One firm is a major airline that flies both domestically and internationally and

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Question 7 O pts Airlines Companies M and N are airline companies. One firm is a major airline that flies both domestically and internationally and offers additional services including travel packages and airplane repair. The company owns a refinery to supply its own jet fuel as a hedge to fuel-price volatility. In 2008, this company merged with one of the largest airline carriers in the United States. The other company operates primarily in the United States, with some routes to the Caribbean and Latin America. It is the leading low-cost carrier in the United States. One source of operating efficiency is the fact that the company carries only three different aircraft in fleet, making mai enance mu simpler legacy airlines that might need to service 20 or 30 different aircraft models. This company's growth has been mostly organic - it expands its routes by purchasing new aircraft and the rights to fly into new airports. Hints: - When is "Goodwill" generated? - If you own only 3 types of airplanes, it means you can maintain a lower number of spare parts to service them. Where would this be reflected? Large Airline is M, Low-Cost carrier is N O Large Airline is N, Low-Cost carrier is M Beer B 15 9 9 A 5 3 2 3 14 14 0 70 70 2 100 3 35 64 0 1 1 1 100 Power C D 5 25 7 8 2 7 5 6 19 46 62 19 0 0 8 3 12 33 100 100 Retail E F 30 8 10 3 16 25 0 4 56 39 33 49 0 0 6 6 4 7 100 100 Hospitality G H 7 2 4 18 0 0 4 3 15 23 53 17 0 0 9 39 23 21 100 100 Computers 1 14 41 10 18 1 16 5 9 31 84 8 4 56 56 0 3 2 2 9 100 100 Newspapers K L 25 35 9 14 0 2 2 4 ad . 36 56 25 23 13 0 5 19 21 2 100 100 Airlines M N 6 10 4 2 1 1 5 4 17 16 42 75 0 1 28 1 1 13 8 100 Pharmaceutic 0 P 1 13 5 11 2 3 10 2 2 11 35 3 23 0 10 85 26 1 6 100 100 100 31 5 15 6 0 12 18 52 9 4 8 21 32 9 4 66 34 100 13 7 0 11 17 0 9 9 3 29 71 100 0 5 7 7 19 50 3 12 83 17 100 5 1 8 13 4 7 0 7 24 76 100 17 0 20 38 36 0 15 89 11 100 12 4 12 28 18 " 8 4 2 4 8 15 14 " 1 .. 18 47 53 100 10 5 38 53 63 0 43 159 (59) 100 5 3 24 24 33 13 0 4 4 0 20 24 0 0 5 29 71 100 4 8 12 23 10 0 32 66 34 100 2 5 5 19 26 16 10 14 6 63 37 100 1 2 8 o 11 62 12 3 88 12 100 4 4 0 19 23 22 0 0 13 59 41 100 2 14 59 80 20 100 0 28 46 54 100 34 80 20 100 41 100 100 ASSETS (%) %) Cash & ST Investments Receivables Inventory Current Assets Other Current Assets-Total Net Property, Plant, & Equipment Long-Term Marketable Securities Goodwill & Intangibles Assets Other Assets-Total LIABILITIES & EQUITY (%) Accounts Payable Debt in Current Liabilities Current Liabilities-Other Current LiabilitiesTotal Long-Term Debt Deferred Taxes Liabilities Other Liabilities-Total Stockholders' Equity Total Liabilities & Equity INCOME/EXPENSES (%) Revenue Cost of Goods Sold Gross Profit SG&A Expense R&D Exp. Depreciation & Amort. Other Operating Expense Earnings before Interest and Taxes Net Interest Expense Other Pretax Income Income Tax Expense Minority Int. in Earnings Net Income MARKET DATA Beta Price/Eamings Price to Book Dividend Payout (%) LIQUIDITY Current Ratio Quick Ratio ASSET MANAGEMENT Inventory Turnover Receivables Turnover Fixed Assets Turnover DEBT MANAGEMENT T. Total Debt/Total Assets (%) LT Debt/Shareholders' Equity (%) Interest Coverage DuPONT ANALYSIS Net Profit Margin (%) Asset Turnover Return on Equity (%) nmf = not a meaningful figure 100 (39) 61 (32) 0 0 3 32 (4) 1 29 (6) (4) 19 100 (48) 52 (36) 0 0 0 0 16 0 (0) 16 (6) 0 0 10 100 100 100 100 (81) (74) (67) (63) 19 26 33 36 (1) (7) (19) (28) 0 (4) (12) 0 0 0 0 0 0 (0) (0) 0 18 14 2 8 (6) 0 (0) (1) ( 0 (0) (0) 8 15 1 7 (3) 0 (1) (3) (3) 0 0 0 2 15 1 4 100 100 (63) (26) 37 74 (12) (23) 0 0 (13) (4) 0 0 13 47 (2) (5) (3) 2 8 44 (3) (14) 0 0 5 30 100 (60) 40 (6) (3) 0 0 0 30 1 (0) 11 31 (8) 0 22 23 100 (69) 31 (12) (13) 0 0 6 100 (39) 61 45 0 4 0 12 100 100 (101) (70) (1) 30 0 (4) 0 0 5 (5) 0 (5) ! (5) 16 0 (1) (2) 3 (7) 18 1 (6) 0 0 (7) 11 100 (60) 40 (4) 0 (5) (12) 19 (2) 0 17 17 (7) 0 11 100 (23) 77 (26) (3) 0 (23) ) 25 (15) (12) (1) (1) (0) (3) 100 (24) 76 (33) (24) 0 0 19 (0) (4) 14 (2) 0 12 0 0 6 6 (2 0 4 0 4 0.95 24.2 4.2 88.2 0.95 34.0 3.9 0.0 1.15 1.50 1.05 27.2 9.7 nmf 1.8 1.2 25.5 91.5 0.0 0.0 1.00 1.15 19.2 59.8 6.4 0.3 197.5 0.0 1.15 24.0 nmf 29.5 0.95 12.8 5.0 21.8 1.20 22.0 2.8 0.0 0.95 nmf 0.8 (39.4) 1.15 34.9 2.7 41.8 1.20 10.0 3.9 7.9 1.10 10.9 2.4 0.0 0.75 22.9 6.1 88.7 1.15 18.3 5.5 0.0 0.64 0.41 2.01 1.35 0.99 3.48 1.08 0.63 2.490.77 1.04 1.02 0.30 0.72 0.43 0.37 1.11 0.90 3.50 2.45 3.17 2.82 1.53 1.45 0.52 0.31 0.60 0.44 1.53 1.03 1.04 0.62 62.8 5.9 13.0 2.2 8.5 25.3 2.4 17.6 5.8 0.6 4.6 9.3 7.7 17.8 5.5 4.9 11.7 4.1 109.7 nmf 8.8 13.1 0.6 14.1 13.6 10.8 3.9 5.3 22.0 61.2 8.3 4.8 nmf 7.1 2.4 37.0 16.5 1.9 85.4 43.3 1.0 1.6 5.9 2.5 2.3 4.3 7.6 2.5 66.0 95.2 6.5 28.5 0.1 nmf 83.0 24.2 79.5 88.7 47.4 47.4 159.0 292.5 5.2 106.0 320.9 26.2 nmf 1.9 74.1 4.9 10.2 4.8 8.1 58.9 44.8 97.2 29.1 0.0 nmf 45.7 0.0 nmf 65.7 29.3 4.2 79.6 62.4 13.6 62.9 43.5 10.0 59.0 54.6 23.2 87.7 501.9 1.7 19.0 0.3 19.7 10.3 1.5 21.9 2.0 15.3 0.6 0.4 0.5 1.8 11.2 10.4 4.9 4.2 1.7 36.2 4.9 0.3 2.9 30.1 2.4 nmf 22.8 0.9 46.2 3.8 1.1 5.8 (6.6) 1.0 (14.8) 4.0 0.6 8.1 11.1 0.8 46.0 10.6 0.8 23.6 12.1 0.6 16.1 (2.8) 0.3 (5.0) Question 7 O pts Airlines Companies M and N are airline companies. One firm is a major airline that flies both domestically and internationally and offers additional services including travel packages and airplane repair. The company owns a refinery to supply its own jet fuel as a hedge to fuel-price volatility. In 2008, this company merged with one of the largest airline carriers in the United States. The other company operates primarily in the United States, with some routes to the Caribbean and Latin America. It is the leading low-cost carrier in the United States. One source of operating efficiency is the fact that the company carries only three different aircraft in fleet, making mai enance mu simpler legacy airlines that might need to service 20 or 30 different aircraft models. This company's growth has been mostly organic - it expands its routes by purchasing new aircraft and the rights to fly into new airports. Hints: - When is "Goodwill" generated? - If you own only 3 types of airplanes, it means you can maintain a lower number of spare parts to service them. Where would this be reflected? Large Airline is M, Low-Cost carrier is N O Large Airline is N, Low-Cost carrier is M Beer B 15 9 9 A 5 3 2 3 14 14 0 70 70 2 100 3 35 64 0 1 1 1 100 Power C D 5 25 7 8 2 7 5 6 19 46 62 19 0 0 8 3 12 33 100 100 Retail E F 30 8 10 3 16 25 0 4 56 39 33 49 0 0 6 6 4 7 100 100 Hospitality G H 7 2 4 18 0 0 4 3 15 23 53 17 0 0 9 39 23 21 100 100 Computers 1 14 41 10 18 1 16 5 9 31 84 8 4 56 56 0 3 2 2 9 100 100 Newspapers K L 25 35 9 14 0 2 2 4 ad . 36 56 25 23 13 0 5 19 21 2 100 100 Airlines M N 6 10 4 2 1 1 5 4 17 16 42 75 0 1 28 1 1 13 8 100 Pharmaceutic 0 P 1 13 5 11 2 3 10 2 2 11 35 3 23 0 10 85 26 1 6 100 100 100 31 5 15 6 0 12 18 52 9 4 8 21 32 9 4 66 34 100 13 7 0 11 17 0 9 9 3 29 71 100 0 5 7 7 19 50 3 12 83 17 100 5 1 8 13 4 7 0 7 24 76 100 17 0 20 38 36 0 15 89 11 100 12 4 12 28 18 " 8 4 2 4 8 15 14 " 1 .. 18 47 53 100 10 5 38 53 63 0 43 159 (59) 100 5 3 24 24 33 13 0 4 4 0 20 24 0 0 5 29 71 100 4 8 12 23 10 0 32 66 34 100 2 5 5 19 26 16 10 14 6 63 37 100 1 2 8 o 11 62 12 3 88 12 100 4 4 0 19 23 22 0 0 13 59 41 100 2 14 59 80 20 100 0 28 46 54 100 34 80 20 100 41 100 100 ASSETS (%) %) Cash & ST Investments Receivables Inventory Current Assets Other Current Assets-Total Net Property, Plant, & Equipment Long-Term Marketable Securities Goodwill & Intangibles Assets Other Assets-Total LIABILITIES & EQUITY (%) Accounts Payable Debt in Current Liabilities Current Liabilities-Other Current LiabilitiesTotal Long-Term Debt Deferred Taxes Liabilities Other Liabilities-Total Stockholders' Equity Total Liabilities & Equity INCOME/EXPENSES (%) Revenue Cost of Goods Sold Gross Profit SG&A Expense R&D Exp. Depreciation & Amort. Other Operating Expense Earnings before Interest and Taxes Net Interest Expense Other Pretax Income Income Tax Expense Minority Int. in Earnings Net Income MARKET DATA Beta Price/Eamings Price to Book Dividend Payout (%) LIQUIDITY Current Ratio Quick Ratio ASSET MANAGEMENT Inventory Turnover Receivables Turnover Fixed Assets Turnover DEBT MANAGEMENT T. Total Debt/Total Assets (%) LT Debt/Shareholders' Equity (%) Interest Coverage DuPONT ANALYSIS Net Profit Margin (%) Asset Turnover Return on Equity (%) nmf = not a meaningful figure 100 (39) 61 (32) 0 0 3 32 (4) 1 29 (6) (4) 19 100 (48) 52 (36) 0 0 0 0 16 0 (0) 16 (6) 0 0 10 100 100 100 100 (81) (74) (67) (63) 19 26 33 36 (1) (7) (19) (28) 0 (4) (12) 0 0 0 0 0 0 (0) (0) 0 18 14 2 8 (6) 0 (0) (1) ( 0 (0) (0) 8 15 1 7 (3) 0 (1) (3) (3) 0 0 0 2 15 1 4 100 100 (63) (26) 37 74 (12) (23) 0 0 (13) (4) 0 0 13 47 (2) (5) (3) 2 8 44 (3) (14) 0 0 5 30 100 (60) 40 (6) (3) 0 0 0 30 1 (0) 11 31 (8) 0 22 23 100 (69) 31 (12) (13) 0 0 6 100 (39) 61 45 0 4 0 12 100 100 (101) (70) (1) 30 0 (4) 0 0 5 (5) 0 (5) ! (5) 16 0 (1) (2) 3 (7) 18 1 (6) 0 0 (7) 11 100 (60) 40 (4) 0 (5) (12) 19 (2) 0 17 17 (7) 0 11 100 (23) 77 (26) (3) 0 (23) ) 25 (15) (12) (1) (1) (0) (3) 100 (24) 76 (33) (24) 0 0 19 (0) (4) 14 (2) 0 12 0 0 6 6 (2 0 4 0 4 0.95 24.2 4.2 88.2 0.95 34.0 3.9 0.0 1.15 1.50 1.05 27.2 9.7 nmf 1.8 1.2 25.5 91.5 0.0 0.0 1.00 1.15 19.2 59.8 6.4 0.3 197.5 0.0 1.15 24.0 nmf 29.5 0.95 12.8 5.0 21.8 1.20 22.0 2.8 0.0 0.95 nmf 0.8 (39.4) 1.15 34.9 2.7 41.8 1.20 10.0 3.9 7.9 1.10 10.9 2.4 0.0 0.75 22.9 6.1 88.7 1.15 18.3 5.5 0.0 0.64 0.41 2.01 1.35 0.99 3.48 1.08 0.63 2.490.77 1.04 1.02 0.30 0.72 0.43 0.37 1.11 0.90 3.50 2.45 3.17 2.82 1.53 1.45 0.52 0.31 0.60 0.44 1.53 1.03 1.04 0.62 62.8 5.9 13.0 2.2 8.5 25.3 2.4 17.6 5.8 0.6 4.6 9.3 7.7 17.8 5.5 4.9 11.7 4.1 109.7 nmf 8.8 13.1 0.6 14.1 13.6 10.8 3.9 5.3 22.0 61.2 8.3 4.8 nmf 7.1 2.4 37.0 16.5 1.9 85.4 43.3 1.0 1.6 5.9 2.5 2.3 4.3 7.6 2.5 66.0 95.2 6.5 28.5 0.1 nmf 83.0 24.2 79.5 88.7 47.4 47.4 159.0 292.5 5.2 106.0 320.9 26.2 nmf 1.9 74.1 4.9 10.2 4.8 8.1 58.9 44.8 97.2 29.1 0.0 nmf 45.7 0.0 nmf 65.7 29.3 4.2 79.6 62.4 13.6 62.9 43.5 10.0 59.0 54.6 23.2 87.7 501.9 1.7 19.0 0.3 19.7 10.3 1.5 21.9 2.0 15.3 0.6 0.4 0.5 1.8 11.2 10.4 4.9 4.2 1.7 36.2 4.9 0.3 2.9 30.1 2.4 nmf 22.8 0.9 46.2 3.8 1.1 5.8 (6.6) 1.0 (14.8) 4.0 0.6 8.1 11.1 0.8 46.0 10.6 0.8 23.6 12.1 0.6 16.1 (2.8) 0.3 (5.0)