Question: Financial Leverage Microsoft Corporation (MSFT) reported the following data (in millions) for a recent year: Sales $ 93,580 Operating income 12,193 Average total assets 174,304

 Financial Leverage Microsoft Corporation (MSFT) reported the following data (in millions)

Financial Leverage Microsoft Corporation (MSFT) reported the following data (in millions) for a recent year: Sales $ 93,580 Operating income 12,193 Average total assets 174,304 Average stockholders' equity 84,934 1. Compute the return on total assets. Round to one decimal place. 7.0 % 2. Compute the return on stockholders' equity. Round to one decimal place. 14.3 X % 3. Compute the profit margin, asset turnover, and financial leverage metrics using the expanded DuPont formula. Round profit margin, asset turnover, and financial leverage to two decimal places. Round return on stockholders' equity to one decimal place. Profit margin 13.03 % Asset turnover 0.53 Financial leverage 2.05 Return on stockholders' equity 14.3 X % 4. Apple Inc. has a financial leverage metric of 2.26. Does Apple or Microsoft use more financial leverage in its operations? Apple

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!