The Coca-Cola Company reported an after-tax profit margin of 20.0 percent on its sales of $24,088 million
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The Coca-Cola Company reported an after-tax profit margin of 20.0 percent on its sales of $24,088 million in 2006. It also reported $102 million of other core income, mainly from equity investments in its bottling companies. Further analysis of the financial statements reveals an asset turnover (on net operating assets) of 1.32. Coke uses a hurdle of 9 percent for its investment in operations.
a. What was Coke's residual operating income for 2006?
b. What would Coke's residual operating income be if the asset turnover increased to 1.7?
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Asset Turnover
Asset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio.
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Related Book For 
Financial Statement Analysis and Security Valuation
ISBN: 978-0078025310
5th edition
Authors: Stephen Penman
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