Question
You are a Corporate Financial Analyst at Callaway Golf Company, located in beautiful Carlsbad, California. You are reviewing historical financial statements. You take notice of
You are a Corporate Financial Analyst at Callaway Golf Company, located in beautiful Carlsbad, California. You are reviewing historical financial statements. You take notice of the following facts.
- Revenue grew from $1.24B in 2018 to $1.70B in 2019, a Growth Rate of about 37%
- EBIT grew from $128.4 million in 2018 to $132.7 million in 2019, a Growth Rate of about 3%
From the above, we can calculate the EBIT Margins as follows.
- 2018 EBIT Margin = 10.4%
- 2019 EBIT Margin = 7.8%
Although the Revenue Growth Rate was a huge 37% from year to year, why did the EBIT Margin decline?
Group of answer choices
COGS and Operating Expenses increased dramatically
COGS and Operating Expenses decreased dramatically
None of the above'
Based on the previous Question, why did the EBIT Margin decline?
Group of answer choices
Interest and Taxes increased dramatically
Interest and Taxes decreased dramatically
None of the above
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