Marriott Corporation split into two companies: Host Marriott Corporation and Marriott International. Host Marriott retained ownership of the corporation's vast hotel and other properties, while Marriott International, rather than owning hotels, managed them. The purpose of this split was to free Marriott International from the "baggage" associated with Host Marriott, thus allowing it to be more aggressive in its pursuit of growth. Assume the following information (in millions) is provided for each corporation for their first full year operating as independent companies. Sales revenue Net income Average total assets Total liabilities Average common stockholders' equity (b) Debt to assets ratio (c) Host Marriott Marriott International Return on assets Host Marriott $1,501 Return on common stockholders' equity (25) 3,822 3,112 710 Calculate the debt to assets ratio for each company. (Round answers to 1 decimal place, e.g. 15.2%.) % $8,415 3,207 Host Marriott 200 2,440 Marriott International Calculate the return on assets and return on common stockholders' equity for each company. (Round answers to 1 decimal place, e.g. 15.2%. Enter negative answers using either a negative sign preceding the number e.g. -15.2 % or parentheses e.g. (15.2)%.) 767 % % % Marriott International % %
Marriott Corporation split into two companies: Host Marriott Corporation and Marriott International. Host Marriott retained ownership of the corporation's vast hotel and other properties, while Marriott International, rather than owning hotels, managed them. The purpose of this split was to free Marriott International from the "baggage" associated with Host Marriott, thus allowing it to be more aggressive in its pursuit of growth. Assume the following information (in millions) is provided for each corporation for their first full year operating as independent companies. Sales revenue Net income Average total assets Total liabilities Average common stockholders' equity (b) Debt to assets ratio (c) Host Marriott Marriott International Return on assets Host Marriott $1,501 Return on common stockholders' equity (25) 3,822 3,112 710 Calculate the debt to assets ratio for each company. (Round answers to 1 decimal place, e.g. 15.2%.) % $8,415 3,207 Host Marriott 200 2,440 Marriott International Calculate the return on assets and return on common stockholders' equity for each company. (Round answers to 1 decimal place, e.g. 15.2%. Enter negative answers using either a negative sign preceding the number e.g. -15.2 % or parentheses e.g. (15.2)%.) 767 % % % Marriott International % %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Marriott Corporation split into two companies: Host Marriott Corporation and Marriott International. Host Marriott retained
ownership of the corporation's vast hotel and other properties, while Marriott International, rather than owning hotels, managed
them. The purpose of this split was to free Marriott International from the "baggage" associated with Host Marriott, thus allowing it to
be more aggressive in its pursuit of growth. Assume the following information (in millions) is provided for each corporation for their
first full year operating as independent companies.
Sales revenue
Net income
Average total assets
Total liabilities
Average common stockholders' equity
(b)
Debt to assets ratio
(c)
Host Marriott Marriott International
Return on assets
Host Marriott
$1,501
Return on common stockholders' equity
(25)
3,822
3,112
710
Calculate the debt to assets ratio for each company. (Round answers to 1 decimal place, e.g. 15.2%.)
%
$8,415
3,207
2,440
Host Marriott
200
Marriott International
Calculate the return on assets and return on common stockholders' equity for each company. (Round answers to 1 decimal place, e.g.
15.2%. Enter negative answers using either a negative sign preceding the number e.g. -15.2% or parentheses e.g. (15.2)%.)
767
%
%
%
Marriott International
%
%
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