Question: Compute NOPAT Selected income statement information for 2018 is presented below for Home Depot Inc. and Lowe's Companies Inc. Assume the statutory tax rate
Compute NOPAT Selected income statement information for 2018 is presented below for Home Depot Inc. and Lowe's Companies Inc. Assume the statutory tax rate is 22%. Average Net Operating Pretax Net Nonoperating Tax Company (S millions) Ticker Home Depot Sales NOPBT Expense Expense Assets HD $108,203 $15,219 $955 $3,366 $24,713 Lowe's LOW 69,883 3,938 612 1,080 20,326 a. Compute the following measures for both companies. Measure Rounding Instructions Home Depot Lowe's 1. Net operating profit (NOPAT) 2 Return on net operating assets (RNOA) Round percentage to one decimal place 3. Net operating profit margin (NOPM) 4 Net operating asset turnover (NOAT) Round to nearest whole dollar 0% 0 % Round percentage to one decimal place 0% 0% Round amount to two decimal places b. Indicate which of these two companies: 1. Is more profitable (in Ss). 2 Produces the higher profit margin (in 96). 3. Uses its NOA more efficiently. 4. Produces the higher return on NOA. Check
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Home depot Lowes Net operating Profit before TaxNOPBT Less Pre tax net non operating expenses 15... View full answer
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