Lennox International Inc. makes air conditioning, heating, and fireplace systems for residential and commercial uses, as well as commercial refrigeration equipment. Tecumseh Products Company manufactures air conditioning and refrigeration compressors, condensing units, heat pumps, and complete refrigeration systems. Select financial statement data and asset utilization ratios for each company follow.

Required:
1. Compare the asset utilization effectiveness of the two companies. Which company seems to be doing a better job?
2. How do the companies' operating profit margins compare?

Transcribed Image Text:

Lennox International 2014 (S in millions) Sales ROA Current assets turnover Fixed (long-term) assets turnover Total assets turnover 2012 2013 $2,949.4 0.059 2.95 4.22 1.74 $3,199.1 0.109 3.39 4.48 1.93 $3,367.4 0.127 3.51 4.57 1.99 Tecumseh Products Company (S in millions) Sales ROA Current assets turnover Fixed (long-term) assets turnover Total assets turnover 2012 2013 2014 $854.7 0.053 2.66 3.81 1.57 $823.6 0.063) 2.59 4.34 1.62 $724.4 (0.060) 2.54 4.62 1.64