118-SP'08-MIDTERM-OXY-KEY

118-SP'08-MIDTERM-OXY-KEY - Econ 118-Sp’08-Midterm answer...

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Unformatted text preview: Econ 118-Sp’08-Midterm answer key - p1 Econ 118–Financial Statement Analysis–SP’08 Midterm Exam – 100 points ANSWER KEY All questions are based on the annual report of Occidental Petroleum Corporation (OXY) OXY is a U.S.-based integrated oil company with global operations in oil and gas exploration and production (74% of 2007 segment revenues) and basic chemicals (26%). The questions that follow are based on selected pages from its 2007 annual report on Form 10-K, which are attached. Use year-end numbers where a formula calls for an average. The U.S. federal statutory tax rate was 35% for all periods. Show all your work. Clearly label all answers. Watch your pluses and minuses! Question 1 – Return on assets (50 points) Compute return on assets for 2007 and 2006. Disaggregate ROA into its two components and explain the significance of each component. Evaluate the results. ROA NI + (1 - t) Int exp + MI in NI +/- After-tax special items ROA = ___________________________________________________...
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This note was uploaded on 09/10/2008 for the course ECON 118 taught by Professor Loster during the Summer '07 term at UCSB.

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118-SP'08-MIDTERM-OXY-KEY - Econ 118-Sp’08-Midterm answer...

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