Compute common-size percents for both companies using the

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Reference no: EM13480596

Key comparative figures ($ millions) for both NIKEand Reebokfollow:

Key Figures

NIKE

Reebok

Cash and equivalents

$ 108.6

$ 209.8

Accounts receivable

1,674.4

561.7

Inventories

1,396.6

563.7

Retained earnings

3,043.4

1,145.3

Costs of sales.

6,065.5

2,294.0

Income taxes

$ 253.4

$ 12.5

Revenues (Nike)

9,553.1

-

Net sales (Reebok)

-

3,643.6

Total assets

5,397.4

1,756.1

Required:

a. Compute common-size percents for both companies using the data provided.

b. Which company incurs a higher percent of their revenues (net sales) in income taxes?

c. Which company retains a higher portion of cumulative net income in the company?

d. Which company has a higher gross margin ratio on sales?

e. Which company holds a higher percent of its total assets as inventory?

Reference no: EM13480596

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