Using DuPont Analysis to Compare Corporate Performance

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Financial Accounting
C.Mulford: Financial Statement Analysis: 35
Using DuPont Analysis to Compare Corporate Performance
Exercise Using Data for
Thiokol Corp. and Wyman-Gordon, Inc.
Use the data provided below to compare financial performance
for the two companies (amounts in millions).
Thiokol
$ 889.5
Wyman-Gordon
$ 499.6
Sales
Net income
$ 51.4
$ 25.2
Total assets
$ 818.3
$ 375.9
Shareholders' equity
$ 447.9
$ 109.9
Using DuPont Analysis we see that,
Thiokol Corp.:
Return on equity
Net income
Sales
Total assets
X
X
Sales
Total assets
Shareholders' equity
Financial leverage.
(debt multiplier)
Net margin
X Asset turnover X
(asset multiplier)
Return on equity
X
Transcribed Image Text:Financial Accounting C.Mulford: Financial Statement Analysis: 35 Using DuPont Analysis to Compare Corporate Performance Exercise Using Data for Thiokol Corp. and Wyman-Gordon, Inc. Use the data provided below to compare financial performance for the two companies (amounts in millions). Thiokol $ 889.5 Wyman-Gordon $ 499.6 Sales Net income $ 51.4 $ 25.2 Total assets $ 818.3 $ 375.9 Shareholders' equity $ 447.9 $ 109.9 Using DuPont Analysis we see that, Thiokol Corp.: Return on equity Net income Sales Total assets X X Sales Total assets Shareholders' equity Financial leverage. (debt multiplier) Net margin X Asset turnover X (asset multiplier) Return on equity X
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