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TJ Inc. and Mall Inc.operate in the same industry. A). Use the financials below to compare the two firmsFocus on the three levers of performance

TJ Inc. and Mall Inc.operate in the same industry.

A). Use the financials below to compare the two firmsFocus on the three levers of performance that affect return on equity (ROE), comparing and contrasting these three DuPont components of ROE.

B.) Do you think the difference between these firms can be attributed to weak management in one of the firms; or could it be that the two simply have different competitive strategies? Explain briefly.

TJ Inc

In$000's

Mall Inc

In$000's

200X

200X

Revenue

59,490,000

Revenue

348,650,000

COGS

39,399,000

COGS

264,152,000

Gross Profit

20,091,000

Gross Profit

84,498,000

Operating Exp

15022000

Operating Exp

64001000

Operating Profits

5,069,000

Operating Profits

20,497,000

Interest Expense

597,000

Interest Expense

1,809,000

EBT

4,472,000

EBT

18,688,000

Tax

1,710,000

Tax

6,365,000

Net Income

2,762,000

Net Income

12,323,000

Assets

31-Dec-0X

Assets

31-Dec-0X

Cash

813,000

Cash

7,373,000

A/R

6,194,000

A/R

2,840,000

Inventory

6,254,000

Inventory

33,685,000

Current Assets

13,261,000

Current Assets

43,898,000

Prop, Plant & Equip

21,431,000

Prop, Plant & Equip

88,440,000

Total Assets

34,692,000

Total Assets

132,338,000

Liabilities & Equity

Liabilities & Equity

A/P

9,755,000

A/P

43,471,000

ST Portion of LTD

1,362,000

ST Portion of LTD

8,283,000

Current Liabilities

11,117,000

Current Liabilities

51,754,000

LT Debt

10,599,000

LT Debt

30,735,000

Total Liabilities

21,716,000

Total Liabilities

82,489,000

Total Equity

12,976,000

Total Equity

49,849,000

Total L & Equity

34,692,000

Total L & Equity

132,338,000

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