Suppose you wanted to compare the fiscal year 2013 revenue of Hewlett Packard (HP) with the fiscal year 2013 revenue of Dell. Which numbers would you compare? Which financial statement provides more information, Dell or HP? Why? What might you infer from the disclosure differences on the income statement?

Dell

2. Using only the information provided, which company has higher gross margin percentages on computer sales? Which company has higher computer sales growth? As a percentage of total revenue, which company has higher SG&A? Higher R&D? Higher operating expenses? What do these differences tell you about the operations of these two companies?

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February 1, 2013 % of Revenue Dollars Net revenue: Product 44,744 78.6% Services, including software related 12,196 21.4% Total net revenue 56,940 100.0% Gross margin: Product 8,061 18.0% Services, including software related 4,125 33.8% Total gross margin 12,186 21.4% Operating expenses 9,174 16.1% Operating income 3,012 5.3% Net income 2,372 4.2% Earnings per share diluted 1.35 N/A Other Financial Information (a) Non-GAAP gross margin 12,708 22.3% Non-GAAP operating expenses 8,735 15.3% Non-GAAP operating income 3,973 7.0% Non-GAAP net income 3,017 5.3% Non-GAAP earnings per share - diluted 1.72 N/A %24 %24 SS SS February 1, 2013 % of Revenue Dollars Net revenue: Product 44,744 78.6% Services, including software related 12,196 21.4% Total net revenue 56,940 100.0% Gross margin: Product 8,061 18.0% Services, including software related 4,125 33.8% Total gross margin 12,186 21.4% Operating expenses 9,174 16.1% Operating income 3,012 5.3% Net income 2,372 4.2% Earnings per share diluted 1.35 N/A Other Financial Information (a) Non-GAAP gross margin 12,708 22.3% Non-GAAP operating expenses 8,735 15.3% Non-GAAP operating income 3,973 7.0% Non-GAAP net income 3,017 5.3% Non-GAAP earnings per share - diluted 1.72 N/A %24 %24 SS SS

Answer rating: 100% (QA)

aEarning per share is the key factor that I would take into consideration It is the amount that a co... View the full answer