Computing and Interpreting Return on Assets and Its Components McDonalds Corporation (MCD) reported the following balance sheet and income statement data for 2016 through 2018 $ millions Total Assets Net Income Sales 2018 32811 20 5924 30 21025 20 2017 33,803 7 5,192 3 22,820 4 2016 31,023 9 Required a What is McDonalds return on assets for 2018 and 2017 b Determine the profit margin for 2018 and 2017 c Calculate the asset turnover for 2018 and 2017 d What factor is mainly responsible for the change in McDonalds ROA over this period Is it profit margin or asset turnover or both

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Question: Computing and Interpreting Return on Assets and Its Components McDonalds Corporation (MCD) reported the following balance sheet and income statement data for 2016 through 2018.

Computing and Interpreting Return on Assets and Its Components McDonalds Corporation (MCD) reported the following balance sheet and income statement data for 2016 through 2018.

$ millions	Total Assets	Net Income	Sales
2018	32811.20	5924.30	21025.20
2017	33,803.7	5,192.3	22,820.4
2016	31,023.9

Required

a. What is McDonalds return on assets for 2018 and 2017?

b. Determine the profit margin for 2018 and 2017.

c. Calculate the asset turnover for 2018 and 2017.

d. What factor is mainly responsible for the change in McDonalds ROA over this period? Is it profit margin or asset turnover or both?

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