Refer to the $$nancial information for TeaSea Corporation $($the Company$)$ below.Discuss any di$$erences across these three companies in the turnover ratios computed in a and b$.$

Answer $25$

has the lowest asset turnover of the three companies and Answer $26$

VIO Health Corporation

has the highest asset turnover of the three companies.

Answer $27$

The Duncan & Franklin Company

collects on receivables from their customers the most quickly.

Answer $28$

carries the smallest amount of inventory relative to its cost of sales.

Answer $29$

turns its inventory the slowest.

Answer $30$

is the most capital intensive relative to its sales levels.

$($$ millions$)$ February $1,2020$ February $2,2019$

Assets

Cash and cash equivalents $$1,289$ $$778$

Inventory $4,4964,749$

Other current assets $667733$

Total current assets $6,4526,260$

Property and equipment, net $13,14212,767$

Operating lease assets $1,118983$

Other noncurrent assets $679637$

Total assets $$21,391$ $$20,647$

Liabilities and shareholders$$ investment

Accounts payable $$4,960$ $$4,881$

Accrued and other current liabilities $2,2032,101$

Current portion of long$-$term debt and other borrowings $81526$

Total current liabilities $7,2447,508$

Long$-$term debt and other borrowings $5,6695,112$

Noncurrent operating lease liabilities $1,1381,002$

Deferred income taxes $561486$

Other noncurrent liabilities $862890$

Total noncurrent liabilities $8,2307,490$

Total shareholders$$ investment $5,9175,649$

Total liabilities and shareholders$$ investment $$21,391$ $$20,647$

Fiscal Year Ended

$($$ millions$)$ February $1,2020$

Sales $$39,056$

Cost of sales $27,432$

Selling, general, and administrative expenses $8,117$

Depreciation and amortization $($exclusive of depreciation included in cost of sales$)1,179$

Operating income $2,328$

Net interest expense $239$

Net other $($income$)/$expense $(5)$

Earnings from continuing operations before income taxes $2,094$

Provision for income taxes $461$

Net earnings from continuing operations $1,633$

Discontinued operations, net of tax $6$

Net earnings $$1,639$

a$.$ Compute its return on assets $($ROA$)$ for the $$scal year ending February $1,2020.$ Compute two ROA measures: one using net earnings from continuing operations and one using net earnings. Assume a statutory tax rate of $25\%.$

$$ Note: Round your answers to the nearest million dollars.

Numerator $($$ millions$)-$: Denominator $($$ millions$)=$ Result

ROA from continuing operations Answer $1$

$-$: Answer $2$

$=$

ROA from net earnings Answer $3$

$-$: Answer $4$

$=$

b$.$ Disaggregate ROA into pro$$t margin $($PM$)$ and asset turnover $($AT$).$ Con$$rm that ROA $=$ PM $\backslash$times AT$.$

$$ Note: Round your answers to the nearest million dollars.

Numerator $($$ millions$)-$: Denominator $($$ millions$)=$ Result

PM from continuing operations Answer $5$

$-$: Answer $6$

$=$

AT from continuing operations Answer $7$

$-$: Answer $8$

$=$

PM from net earnings Answer $9$

$-$: Answer $10$

$=$

AT from net earnings Answer $11$

$-$: Answer $12$

$=$

PM x AT $=$ ROA

ROA from continuing operations

x

$0$

$=$

$0$

ROA from net earnings

x

$0$

$=$

$0$