Question
Using the financial data for Uber and Lyft for the fiscal year 2020, perform the required analyses: ($ millions) Uber Lyft Net sales $14,147 $3,209
($ millions) | Uber | Lyft |
Net sales | $14,147 | $3,209 |
Cost of goods sold | $7,832 | $1,684 |
Gross profit | $6,315 | $1,525 |
Operating expenses | $5,290 | $1,222 |
Operating income | $1,025 | $303 |
Interest and other (income) expense | $500 | $150 |
Earnings before provision for income taxes | $525 | $153 |
Provision for income taxes | $157 | $46 |
Net earnings | $368 | $107 |
Required: a. Calculate the gross profit margin, operating profit margin, and net profit margin for each company. b. Compute the return on equity (ROE) and return on assets (ROA) for both companies. Assume Uber's equity is $10,000 million and total assets are $25,000 million, while Lyft's equity is $3,500 million and total assets are $6,500 million. c. Determine the debt-to-equity ratio for both companies. d. Compare the profitability and efficiency of both companies based on your calculations. e. Discuss the financial leverage and operational efficiency of both companies.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started