Assume the following data for Interactive Technology and Silicon Software. a. Compute return on shareholders' equity for
Question:
a. Compute return on shareholders' equity for both firms. Which firm has the higher return?
b. Compute the following ratios for both firms:
Net income/sales
Net income/total assets
Sales/total assets
Debt/total assets
c. Discuss the factors that added or detracted from each firm's return on shareholders' equity.
Transcribed Image Text:
Silicon Software (SS) Interactive Technology (IT) $ 15,000 Net income. Sales .... Total assets.. Total debt .... Shareholders' equity. 50,000 150,000 1,000,000 160,000 400,000 60,000 100,000 240,000 160,000
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a b c Silicon Software has a significantly higher return on equity 3125 versus 15 This is despite ...View the full answer
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Related Book For
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
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