Final Application Project

A number of deaths have allegedly been caused by

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Unformatted text preview: red to past years. • Return on Equity – ROE can be defined as the amount of net income returned as a percentage of shareholders equity. The chart below displays calculations from 2012 to 2011 to 2010 respectively. Cooper Tires demonstrates a 31.4% return on equity for the year 2012. • Management Efficiency Ratio - According to Investopedia, a management efficiency ratio is typically used to analyze how well a company uses its assets and liabilities internally. One example of a management efficiency ratio is the repayment of liabilities, also known as the debt coverage ratio. This ratio helps to manage the ability of a company to repay liabilities based off income. • Cooper Tires debt to coverage ratio hit a slump in 2011 due to several issues within the company such as the unplanned pension problems (discussed “current issues”), high raw material costs, and other issues. Fortunately, since then, the company has been able to bounce back in 2012 and increase their debt coverage ratio to 56.42. Meaning that according to income, the company is able to pay back 56.42 % of its liabilities. Leverage and Debt to Assets Ratio The relationship between debt and equity, the higher this ratio the more leverage the firm. As you can see Cooper Tires leverage ratio has decreased significantly over the past 3 years, from 61% in 2010 to 37% in 2012. This is a good sign that the company has decreased their liabilities and increased equity, ultimately generating higher profit margins. The debt to assets ratio signifies how...
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This test prep was uploaded on 03/11/2014 for the course CIV 101 taught by Professor Reeder during the Spring '07 term at Providence College.

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