Describe two competitive companies with similar gross profit figures that ended up with dramatically different net operating income. Provide details of the two companies and include both qualitative and quantitative results to support your response. Provide three factors that financial analysts need to evaluate when determining one of your chosen company's (from the previous question) ability to repay short-term versus long-term debt. Describe in details to support your response.
Competitive companies are often measured by how they compete in their industry. Therefore, analyzing gross profits helps substantiate (or refute) managers' claims of good financial performance. Gross profit signals the health of a company and its closest competitors. A company that creates a superior brand and charges higher prices than its competitors generates higher gross profit. In this discussion question, you will apply theory from your past courses in management and finance:
Describe two competitive companies with similar gross profit figures that ended up with dramatically different net operating income. Provide details of the two companies and include both qualitative and quantitative results to support your response.
Provide three factors that financial analysts need to evaluate when determining one of your chosen company's (from the previous question) ability to repay short-term versus long-term debt. Describe in details to support your response.
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