Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Use the following data for Apple and Dell (in $ million): Apple Dell Profit (operating income) $6,275 $3,190 Sales revenue $32,479 $61,101 Investment (total assets)

Use the following data for Apple and Dell (in $ million):

Apple Dell
Profit (operating income) $6,275 $3,190
Sales revenue $32,479 $61,101
Investment (total assets) $32,460 $27,031

Required: a) compute the ROI for each company. Apple ROI= % (if you get say 12.5%, enter 12.5, not 12.5% or 0.125) Dell ROI= % b) use the DuPont method to decompose ROI into ROI = profit margin * asset turnover. In other words, compute profit margin and asset turnover for each company: Apple profit margin= , asset turnover= (Enter both as a fraction of 1, not as percentage. I.e., if the profit margin is 0.045 (4.5%) and asset turnover is 3.42 (342%), enter 0.045 and 3.42) Dell profit margin= , asset turnover= If you multiply profit margin * asset turnover, you should get the ROI from part (a) c) Which company has higher profit margin?(1=Apple, 2=Dell) d) Which company has higher asset turnover? 1=Apple, 2=Dell)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing An International Approach

Authors: Wally Smieliauskas, Amy Kwan, Kathleen Cogliano, Catherine Barrette

8th Canadian Edition

1259451275, 978-1259451270

More Books

Students also viewed these Accounting questions

Question

10. What is meant by a feed rate?

Answered: 1 week ago

Question

Describe how language reflects, builds on, and determines context?

Answered: 1 week ago