In 2014, Apple reported profits of more than $50 billion on sales of $182 billion. For that same period, Microsoft posted a profit of almost $30 billion on sales of $88 billion. So Apple is a better marketer, right? Sales and profits provide information to com- pare the profitability of these two competitors, but between these numbers is information regarding the efficiency of marketing efforts in creating those sales and profits. Appendix 3, Marketing by the Numbers, discusses other marketing profitability mea- sures beyond the return on marketing investment (marketing ROI) measure described in this chapter. Review the Appendix 2 to answer the questions using the following information from the two companies' incomes statements (all numbers are in thousands): Apple Microsoft Sales $182,795,000 $86,833,000 Gross Profit $70,537,000 $59,899,000 Marketing Expenses $8,994,750 $15,474,000 Net Income (Profit) $52,503,000 $27,759,000 2-14. Go to Yahoo! Finance (http://finance.yahoo.com/) and find the income statements for two other compet- ing companies. Perform the same analyses for these companies that you performed for the previous ques- tion. Which company is doing better overall and with respect to marketing? For marketing expenses, use 75 percent of the company's reported "Selling General and Administrative" expenses, as not all of the expenses in that category are marketing expenses.
In 2014, Apple reported profits of more than $50 billion on sales of $182 billion. For that same period, Microsoft posted a profit of almost $30 billion on sales of $88 billion. So Apple is a better marketer, right? Sales and profits provide information to com- pare the profitability of these two competitors, but between these numbers is information regarding the efficiency of marketing efforts in creating those sales and profits. Appendix 3, Marketing by the Numbers, discusses other marketing profitability mea- sures beyond the return on marketing investment (marketing ROI) measure described in this chapter. Review the Appendix 2 to answer the questions using the following information from the two companies' incomes statements (all numbers are in thousands): Apple Microsoft Sales $182,795,000 $86,833,000 Gross Profit $70,537,000 $59,899,000 Marketing Expenses $8,994,750 $15,474,000 Net Income (Profit) $52,503,000 $27,759,000 2-14. Go to Yahoo! Finance (http://finance.yahoo.com/) and find the income statements for two other compet- ing companies. Perform the same analyses for these companies that you performed for the previous ques- tion. Which company is doing better overall and with respect to marketing? For marketing expenses, use 75 percent of the company's reported "Selling General and Administrative" expenses, as not all of the expenses in that category are marketing expenses.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:In 2014, Apple reported profits of more than $50 billion on sales
of $182 billion. For that same period, Microsoft posted a profit
of almost $30 billion on sales of $88 billion. So Apple is a better
marketer, right? Sales and profits provide information to com-
pare the profitability of these two competitors, but between these
numbers is information regarding the efficiency of marketing
efforts in creating those sales and profits. Appendix 3, Marketing
by the Numbers, discusses other marketing profitability mea-
sures beyond the return on marketing investment (marketing
ROI) measure described in this chapter. Review the Appendix
2 to answer the questions using the following information from
the two companies' incomes statements (all numbers are in
thousands):
Apple
Microsoft
Sales
$182,795,000
$86,833,000
Gross Profit
$70,537,000
$59,899,000
Marketing Expenses
$8,994,750
$15,474,000
Net Income (Profit)
$52,503,000
$27,759,000
Transcribed Image Text:2-14. Go to Yahoo! Finance (http://finance.yahoo.com/)
and find the income statements for two other compet-
ing companies. Perform the same analyses for these
companies that you performed for the previous ques-
tion. Which company is doing better overall and with
respect to marketing? For marketing expenses, use 75
percent of the company's reported "Selling General and
Administrative" expenses, as not all of the expenses in
that category are marketing expenses.
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