Investments, 11th Edition (exclude Access Card)
11th Edition
ISBN: 9781260201543
Author: Zvi Bodie Professor; Alex Kane; Alan J. Marcus Professor
Publisher: McGraw-Hill Education
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Question
Chapter 12, Problem 17PS
Summary Introduction
To determine:
The relative strength over the period for Computer Inc. by using its price and computer industry index.
Introduction:
Industry Analysis: It is a most important puppet which was used to compare a specified company's performance with the others in the same industry market.
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DuPont system of analysis Use the following financial information for AT&T and Verizon to
conduct a DuPont system of analysis for each company.
Sales
Earnings available for common stockholders
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a. Which company has the higher net profit margin? Higher asset turnover?
b. Which company has the higher ROA? The higher ROE?
c. Which company has the higher financial leverage multiplier?
a. Net profit margin (Round to three decimal places.)
AT&T
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13,333
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201,934
Verizon
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24,232
Only typed answer
Interpreting liquidity and activity ratios The table, shows key financial data for three firms that compete in the consumer products market: Procter & Gamble, Colgate-Palmolive, and Clorox.
a. Calculate each of the following ratios for all three companies: current ratio, quick ratio, inventory turnover, average collection period, total asset turnover.
b. What company is in the position of having greatest liquidity?
c. Would you say that the three companies exhibit similar performance or quite different performance in terms of collecting receivables? Why do you think that might be?
d. Which company has the most rapid inventory turnover? Which company appears to be least efficient in terms of total asset turnover? Are your answers to those questions a little surprising? If a company is best at inventory turnover and worst at total asset turnover, what do
you think that means?
a. For the three companies, the current ratios are: (Round to three decimal places.)
Colgate-Palmolive
Current…
Chapter 12 Solutions
Investments, 11th Edition (exclude Access Card)
Ch. 12 - Prob. 1PSCh. 12 - Prob. 2PSCh. 12 - Prob. 3PSCh. 12 - Prob. 4PSCh. 12 - Prob. 5PSCh. 12 - Prob. 6PSCh. 12 - Prob. 7PSCh. 12 - Prob. 8PSCh. 12 - Prob. 9PSCh. 12 - Prob. 10PS
Ch. 12 - Prob. 11PSCh. 12 - Prob. 12PSCh. 12 - Prob. 13PSCh. 12 - Prob. 14PSCh. 12 - Prob. 15PSCh. 12 - Prob. 16PSCh. 12 - Prob. 17PSCh. 12 - Prob. 18PSCh. 12 - Prob. 19PSCh. 12 - Prob. 20PSCh. 12 - Prob. 21PSCh. 12 - Prob. 22PSCh. 12 - Prob. 23PSCh. 12 - Prob. 24PSCh. 12 - Prob. 25PSCh. 12 - Prob. 1CPCh. 12 - Prob. 2CPCh. 12 - Prob. 3CPCh. 12 - Prob. 4CPCh. 12 - Prob. 5CP
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- The comparative financial statements of Global Technology are as follows: Review the worksheet RATIOA that follows these requirements. You have been asked to perform a ratio analysis of this company for 2012.arrow_forwardSales Cost of goods sold Receivable Inventory Procter & Gamble $65,235 32,973 4,732 4,795 25,568 28,901 117,030 Total current assets Total current liabilities Total assets (Note: All dollar values are in thousands.) Colgate-Palmolive $15,208 6,077 1,415 1,173 4,348 3,291 12,134 Clorox $5,873 3,227 517 500 1,544 2,043 4,579arrow_forwardHow to compare Market to Book Ratio (as provided below) in between industry average and Company A without tabular data? It's the only data that I have. Please help me.arrow_forward
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