Solution-Compute return on stockholders equity for both

Compute return on stockholders equity for both firms

Assignment Help Cost Accounting

Reference no: EM13327242

Problem

Interpreting results from the Du Pont system of analysis

Assume the following data for Cable Corporation and Multi-Media, Inc.

	Cable Corporation		Multi Media, Inc.
Net income	$	30,700	$	139,000
Sales		314,000		2,120,000
Total assets		468,000		925,000
Total debt		194,000		478,000
Stockholders' equity		274,000		447,000

1) Compute return on stockholders' equity for both firms.

	Return on stockholders' equity
Cable Corporation
Multi Media, Inc.

2) Which firm has the higher return?

(b) Compute the following additional ratios for both firms.

	Cable Corporation	Multi-Media, Inc.
Net income / Sales
Net income / Total assets
Sales / Total assets
Debt / Total assets

Reference no: EM13327242

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Compute return on stockholders equity for both firms

Reference no: EM13327242

Reference no: EM13327242

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