Compute the ratio of income taxes to income earnings

Assignment Help Financial Management
Reference no: EM13333353

Statements for Kellogg's and General Mills reproduced at the end of the book. 

Required

1. Which is the largest expense for each company in the most recent year? What is its dollar amount? Is it logical that this would be the largest expense given the nature of each company's business? Explain your answer.

2. One of the accounts on each company's income statement is ?oSelling, general and administrative expense.?? For each of the two most recent years, compute the ratio of this expense to net sales for each company. Did this ratio increase or decrease from one year to the next? Which company has the lower ratio in each of the two years?

3. Compute the ratio of income taxes to income (earnings) before taxes (use ?oEarnings before Income Taxes and After-tax Earnings from Joint Ventures?? for General Mills) for the two most recent years for each company. Is the ratio the same for Kellogg's for both years? Is the ratio the same for General Mills for both years? Which company has the higher ratio for each of the two years?

Reference no: EM13333353

Questions Cloud

Determine what is the current maket price of bond : A bond has a face value of $100,000 and a cupon rate of 5 %. What is the current maket price of bond. if the market rate is 6.25% interest rate, the bond pays interest annually and matures in 8 yr
Discuss the economic concept of market equilibrium : Discuss the economic concept of "marketequilibrium" including information on supply and demand theories.Essay length should be approximately 350 words, or about onepage.
The deadweight loss that is associated with a monopolistical : The deadweight loss that is associated with a monopolisticallycompetitive market is a result ofa.price falling short of marginal cost in order to increasemarket shareb.price exceeding marginal cost.c.the firm operating in a regulated industry.d.exces..
Find additional premium that ethiers shareholder require : Ethier is financed with 40% debt and has a levered beta of 1.75. If the risk free rate is 4% and the market risk premium is 7%, how much is the additional premium that Ethier's shareholders require to be compensated for financial risk
Compute the ratio of income taxes to income earnings : Which is the largest expense for each company in the most recent year? What is its dollar amount? Is it logical that this would be the largest expense given the nature of each company's business? Explain your answer.
Determine what is the break-even quantity per unit : Shapland Inc. has fixed operating costs of $350,000 and variable costs of $60 per unit. If it sells the product for $70 per unit, what is the break-even quantity
Explain how reported accounting numbers might affect : Explain how reported accounting numbers might affect an individual's perceptions and actions. Cite two examples.
Develop an animated application : In this assignment you will develop an animated application that uses linked lists as the basis of the implementation. This application builds on the application that you worked with for tutorial 3.

Reviews

Write a Review

Financial Management Questions & Answers

  Write a brief overview concerning stock valuation

Write a brief overview concerning stock valuation. A brief explanation of the legal rights and privileges of common stockholders.

  Define environment and general good of society

In particular do you think subjects like customer and employee safety, environment and general good of society fits in this framework or they essentially ignored?

  Herrings stock price after the planned dividend payout

Suppose the company cancels the dividend and announces that it will use the money saved to repurchase shares. What happens to the stock price on the announcement date?

  Explain inappropriate tool for looking at market risk

This will take a little research on the Internet. Why may the bell curve be an inappropriate tool for looking at market risk? Find out what Mandelbrot (The Mis Behvior of Markets) and Taleb (The Black Swan) have to say.

  Calculate the total return and not worry about how

Suppose that a security costs $1,500 today. a Calculate the percentage return on the security if the payoff to the security in one year is $1,000, $1,500, $2,000, or $2,500.

  What are implications for cash flow and shareholder wealth

Companies often try to keep accounting earnings growing at a relatively steady pace in an effort to avoid large swings in earnings from period to period. They also try to manage earnings targets.

  What is her profit - loss

An investor writes (or sells) one put option contract. If the price of gold in the spot market at the maturity date of the option is $1095, what is her profit-loss - The spot rate for the euro when the forward contract matures is $1.50/€. What is h..

  Suppose you take out a home equity calculate your installmen

Suppose you take out a home equity of $325,000 for 25 years an an annual interset rate of 3.49 percent, with payments to be made biweekly payments be?

  Compute the present value of a growing perpetuity

Calculate the present value of a growing perpetuity that makes one payment per year with the first payment, made in exactly one year from now, being $1000. Let the payments grow at an annual rate of 9.9 percent (g = .099).

  Cost-reduction and profit-sharing program

Discuss the major differences between cost-reduction and profit-sharing program, including the philosophic issues underlying each type of program.

  Define what is the current price of the bond

When it matures at the end of 7.5 years it pays out $1,000. If investors wish to earn 2.35% per year on this bond investment, what is the current price of the bond

  Wal-mart company financial analysis

Wal-Mart company Financial analysis

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd