Question: Required: Based upon your output, answer the following questions: A. Which of the two companies, GPS Corporation or Tru, Incorporated, finances a higher percentage


Required: Based upon your output, answer the following questions: A. Which of the two companies, GPS Corporation or Tru, Incorporated, finances a higher percentage of its assets by borrowed funds relative to funds invested by shareholders as measured by the debt to equity ratio in 2021? B. Which of the two companies, GPS Corporation or Tru, Incorporated, indicates a higher profitability during the period 2017-2021 without regard to the sources of financing as measured by the return on assets ratio? C. Which of the two companies, GPS Corporation or Tru, Incorporated, indicates a higher effectiveness of employing resources provided by owners during the period 2017-2021 as measured by the return on shareholders' equity ratio? D. Management is using its borrowed funds to enhance the earnings for shareholders of (a) GPS Corporation, (b) Tru, Incorporated, (c) both firms, or (d) neither firm during the period 2017-2021? A. Higher percentage measured by the debt to equity ratio B. Higher profitability measured by the return on assets ratio GPS Corporation GPS Corporation C. Higher effectiveness measured by the return on shareholders' equity ratio D. Enhance the earnings for shareholders GPS Corporation Both firms Debt to Equity Ratio Debt to Equity Ratio Trend 2.4 2.2 2.0 1.8626 1.8190 1.8 1.6 1.4 1.2 1.0 0.8 0.6 0.4 ($ in 000s) Company / Year GPS Tru 2.2692 2.2049 2.1384 2.1084 2.0750 1.9807 1.8219 2.0777 SUM(Total shareholder... 64,296.1 69,129.955555555 69,912 70,139 70,209.111111111 70,519.5 73,725.555555556 73,831.333333333 75,606 89,368.885555556 0.2 0.0 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 Q Rate of return on shareholders' equity Rate of Return on Shareholders' Equity and Assets Trends Rate of return on assets 30% 25% 20% 15% ($ in 000s) Company / Year GPS Tru 9.5% 9.6% 9.7% 10% 8.8% 8.0% 5% 0% 30% 25% 22.4% 20% 15% 10% 5% 0% 2017 31.3% 30.3% 27.3% 27.2% 5.4% 6.0% 5.9% 5.9% 4.5% 19.4% 18.6% 18.3% 16.2% 12.6% 2018 2019 2020 2021 2017 2018 2019 2020 2021
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
