For simplicity use year end balances in your ratio computations 4 pts Ratio

For simplicity use year end balances in your ratio

This preview shows page 1 - 2 out of 2 pages.

2014 and 2013. For simplicity, use year-end balances in your ratio computations. (4 pts) Ratio 2014 2013 ROE 24.2% 19.9% Profit Margin 10.3% 9.4% Asset Turnover 9.6% 9.3% Financial Leverage 14.3% 11.2% (b) Has the Company’s ROE increased or decreased in 2014? Which component(s) of the ROE decomposition support or contribute to that directional change in the Company’s ROE? It has increased. The profit margin, asset turnover, and financial leverage all increased. (c) Select ONE of the three components of the ROE decomposition and explain what most likely lead to the observed change in that component. (HINT: Explanations for two of the three components are more readily identifiable from the financial statements. You only need to identify ONE of those.) Profit margin was up due to increased net sales. Part II: Press Release and 10-Q for 2015-Q2
Image of page 1
2. Are the Company’s quarterly financial statements audited by independent CPAs? How do you know? 3. What periods are being reported on the Company’s interim income statements? Refer to specific months and years.May 31 2015, May 31 2014, November 30 2014 4. (a) What level of growth does the Company expect for its Net Sales for the fiscal year 2015?
Image of page 2

You've reached the end of your free preview.

Want to read both pages?

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes