Net profit margin for the year. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

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Answer 1

Question

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

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2. In your position as research assistant to a portfolio manager, you need to analyze the profitability of the companies in the portfolio. Using the data for Electronic Arts, Inc. (NASDAQ: EA) below: a. b. C. Fiscal Year Total Revenue Net Income 2016 4,396 1,156 2015 4,515 875 2014 3,575 8 2013 3,797 98 2012 4,143 76 Calculate the net profit margin for each year. Calculate the compound average annual growth rates (CAGR) for revenue and net income using the GEOMEAN function. Is net income growing more slowly or faster than total revenue? Is this a positive for your investment in the company? Calculate the average annual growth rate of total revenue using the AVERAGE function. Is this result more or less accurate than your result in the previous question? Why? d. Create a Column chart of total revenue and net income. Be sure to change the chart so that the x-axis labels contain the year numbers, and format the axis so that 2016 is on the far right side of the axis.

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Assume you are thinking about investing in a company. In order to evaluate the company, you read the annual report. Then, explain to other potential investors, in your opinion, how the information in annual reports can help them make investment decisions.

Answer 2

Question

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Expert Solution & Answer

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Answer 3

Question

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Expert Solution & Answer

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Answer 4

Question

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Expert Solution & Answer

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Answer 5

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 6

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 7

Chapter 1, Problem 2P

a.

Summary Introduction

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 8

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 9

b.

Summary Introduction

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 10

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 11

c.

Summary Introduction

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 12

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 13

d.

Summary Introduction

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Answer 14

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Answer 15

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Answer 16

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Answer 17

Ch. 1 - Prob. 1P Ch. 1 - Prob. 2P Ch. 1 - Prob. 3P Ch. 1 - Prob. 4P

Net profit margin for the year. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Videos

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Want to see the full answer?

Chapter 1 Solutions

Net profit margin for the year. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Videos

To compute: Net profit margin for the year. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To compute: CAGR of revenue and net income using GEOMEAN function. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To compute: CAGR of revenue using AVERAGE function. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To present: Revenue and net income in column chart. Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

Want to see the full answer?

Chapter 1 Solutions

To compute: Net profit margin for the year.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To compute: CAGR of revenue and net income using GEOMEAN function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To compute: CAGR of revenue using AVERAGE function.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.

To present: Revenue and net income in column chart.

Introduction: Net income is the excess of revenue earned over its expenses. It helps the investors to analyze the profitability of the company and take appropriate decision, thereof.