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 2-13. Calculate profit margin, net marketing contribution, marketing return on sales (or marketing ROS), and mar- keting return on investment (or marketing ROI) for each company. Which company is performing better?

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 2-13. Calculate profit margin, net marketing contribution, marketing return on sales (or marketing ROS), and mar- keting return on investment (or marketing ROI) for each company. Which company is performing better?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

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
2-13. Calculate profit margin, net marketing contribution,
marketing return on sales (or marketing ROS), and mar-
keting return on investment (or marketing ROI) for each
company. Which company is performing better?

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