Should Gee Co. proceed with the acquisition of Bea Co.? yes or no? show your solution. The management team of Gee Co. is deciding to acquire Bea Co. an entity that sells a product that compliments its own product. The management of Bea Co. demands a price of P18,000,000 for it to agree with the acquisition by Gee Co. Relevant data gathered for annual operations are as follows: Gee Co. Вea Co. Combined Average Net Income 3,500,000 2,500,000 6,500,000 Depreciation Expense 250,000 150,000 350,000 WACC 12% 15% 12.50%

Should Gee Co. proceed with the acquisition of Bea Co.? yes or no? show your solution. The management team of Gee Co. is deciding to acquire Bea Co. an entity that sells a product that compliments its own product. The management of Bea Co. demands a price of P18,000,000 for it to agree with the acquisition by Gee Co. Relevant data gathered for annual operations are as follows: Gee Co. Вea Co. Combined Average Net Income 3,500,000 2,500,000 6,500,000 Depreciation Expense 250,000 150,000 350,000 WACC 12% 15% 12.50%

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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Using the five-way DuPont deconstruction of ROE, what is the ROE for a firm with the following: Asset turnover 1.6 Operating margin Interest burden 0.82 Net after taxes 0.9 Leverage ratio 1.9 Inventory turns 6.1 O 0.1570 O 0.1629 O 0.1444 O 0.1697 O 0.1510 0.07 A
Both a2 Milk Ltd. And Synlait Ltd. operate in the dairy products industry. The following ratios for a2 Milk Ltd. and Synlait Ltd. were calculated for 2020 and 2019: a2 Milk Ltd. Synlait Ltd. 2020 2019 2020 2019 Gross Profit Margin 55.96% 54.84% 15.64% 18.19% Profit Margin 22.29% 22.12% 5.78% 8.03% Return on Assets 44.52% 48.54% 9.33% 12.81% Return on Equity 40.15% 42.83% 13.69% 17.93% Current Ratio 3.69 times 3.15 times 1.00 times 0.76 times Debt ratio 21.97% 21.76% 59.36% 57.20% Based on the above ratios, comment on a2 Milk Ltd.’s and complete the following Profitability in the Income Statement Profitability to investment Briefly summaries the profitability of a2 Milk by comparing with Synlait Ltd.
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Flounder Corporation is a diversified company that operates in five different industries: A, B, C, D, and E. The following informatio relating to each segment is available for 2026. A B C D E Sales revenue $39,600 $76,200 $575,500 $34,400 $54,400 Cost of goods sold 19.100 49,600 267,500 19,300 30,300 Operating expenses 10,200 39,400 231,500 11,900 18,300 Total expenses 29,300 89,000 499,000 31,200 48,600 Operating profit (loss) $10,300 $(12,800) $76,500 $3,200 $5,800 Identifiable assets $35,400 $79,400 $509,700 $64,300 $50,300 Sales of segments B and C included intersegment sales of $20,200 and $101,700, respectively. (a) Determine which of the segments are reportable based on the: 1. Revenue test. 2. Operating profit (loss) test. 3. Identifiable assets test. eTextbook and Media Save for Later Reportable Segment Attempts: 0 of 3 used Submit Answer (b) Prepare the necessary disclosures required by GAAP. (Enter negative amounts using either a negative sign preceding the number e.g. -45…
Office Depot, Inc. is one of the largest suppliers of office products in the United States. Suppose it had net income of $738.7 million and sales of $50,000 million in 2020 Its total assets were $13,073.1 million at the beginning of the year and $13,717.3 million at the end of the year. What is Office Depot, Inc.’s (a) asset turnover and (b) profit margin? (Round to two decimals.) Provide a brief interpretation of your results.
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