Question: please I need the work, please. thank you Compute the DuPont Disaggregation of ROE Refer to the balance sheets and income statement below for Facebook



please I need the work, please. thank you
Compute the DuPont Disaggregation of ROE Refer to the balance sheets and income statement below for Facebook Inc. FACEBOOK INC. Consolidated Statement of Income For Year Ended December 31, $ millions 2018 Revenue $53,604 Costs and expenses Cost of revenue 9.355 Research and development 10.273 Marketing and sales 7.846 General and administrative 3,451 Total costs and expenses 30.925 Income from operations 22.679 Interest and other income (expense), net 448 Income before provision for income taxes 23,127 Provision for income taxes 3.249 Net income $19.878 2018 2017 $10,019 $8,079 31,095 33.632 7,284 5.832 1,779 1,020 50.177 48,563 24,683 13.721 1.294 1,884 18.301 18,221 $2.576 $2.135 $97,031 $84.524 FACEBOOK INC. Consolidated Balance Sheet At December 31, $ millions Current assets Cash and cash equivalents Marketable securities Accounts receivable, net Prepaid expenses and other current assets Total current assets Property and equipment, net Intangible assets, net Goodwill Other assets Total assets Current liabilities Accounts payable Partners payable Accrued expenses and other current liabilities Deferred revenue and deposits Total current liabilities Other liabilities Total liabilities Stockholders' equity Common stock and additional paid-in capital Accumulated other comprehensive loss Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $820 $380 541 5.509 147 390 2,892 98 3.760 6,417 10.177 7,017 6.190 13,207 42.906 40.584 (760) (227) 41,678 33.990 83,824 74 347 $97,031 $84.524 Required a. Compute return on equity (ROE). Note: Round percentage to one decimal place (for example, enter 6.7% for 6.6555%). 96 b. Apply the DuPont disaggregation into return on assets (ROA) and financial leverage. Note: For FL, round amount to three decimal places (for example, enter 6.776 for 6.77555). Note: For ROA and ROE, round percentages to one decimal place (for example, enter 6.7% for 6.6555%). ROA X FL = ROE c. Calculate the profitability and productivity components of ROA. Note: For AT, round amount to three decimal places (for example, enter 6.776 for 6.77555). Note: For PM and ROA, round percentages to one decimal place (for example, enter 6.7% for 6.655596). PM X AT = ROA % d. Confirm the full DuPont disaggregation: ROE = PM x ATX FL. Note: For AT and FL, round amounts to three decimal places (for example, enter 6.776 for 6.77555). Note: For PM and ROE, round percentages to one decimal place (for example, enter 6.7% for 6.655596). PM x AT X FL = ROE 96
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
