Question: Question 2 Selected financial statement data from AmDell Berhad for end of Year 2020 and 2019 are reproduced below: Year 2020 Year 2019 (RM millions)

Question 2 Selected financial statement data from AmDell Berhad for end of Year 2020 and 2019 are reproduced below: Year 2020 Year 2019 (RM millions) (RM millions) Income Statement data: Revenues Operating income Interest expense Earnings before tax Taxes Net income 542 35 7 28 14 14 979 68 0 68 34 34 Statement of Financial Position data: Non-current assets Working capital Total liabilities Total common shareholder's equity 52 123 50 125 63 157 0 220 From the above information, you are required to: a. determine the Return on Net Operating Assets (RNOA) and Return on Common shareholders' Equity (ROCE) for Year 2020 and 2019 using end-of- year values for computations requiring an average. Assume non-current assets and working capital are operating. 50% is the effective tax rate. (10 Marks) b. based on your answer in part (a) discuss on AmDell Berhad's on their use of financial leverage (5 Marks) (Total: 15 Marks)
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
