Use the following ratio information for Johnson International and the industry averages for Johnson's line of business
Question:
Use the following ratio information for Johnson International and the industry averages for Johnson's line of business to:
a. Construct the DuPont system of analysis for both Johnson and the industry.
b. Evaluate Johnson (and the industry) over the 3-year period.
c. Indicate in which areas Johnson requires further analysis.Why?
Johnson 2010 2011 2012 Financial leverage multiplie Net profit margin Total asset turnover 1.75 175 1.85 0.059 0.058 0.049 2.11 2.18 2.3 Industry Averages Financial leverage multiplier .67 Net profit margin Total asset turnover 1.64 .0S4 0.047 0.041 2.0S 2.13 2.1S 1.69
Step by Step Answer:
a Margin Turnover ROA FL Multiple ROE 2012 Johnson 49 234 1147 185 2121 Industry 41 215 882 164 1446 ...View the full answer
Principles Of Managerial Finance
ISBN: 978-0136119463
13th Edition
Authors: Lawrence J. Gitman, Chad J. Zutter
Related Video
The Dupont analysis is an expanded return on equity formula, calculated by multiplying the net profit margin by the asset turnover by the equity multiplier. The DuPont analysis is also known as the DuPont identity or DuPont model.This Video will guide on how to calculate return on Equity and estimate profitability of shareholders using DuPont Analysis.
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