Return Analysis Information is provided below for three manufacturers from their 2001 annual reports.
|
(In millions) |
Caterpillar, Inc. (agricultural machinery) |
Kellogg Co. |
Eli Lilly & Co. |
|
Net sales |
$20,450 |
$8,853 |
$11,543 |
|
Net income (loss) |
805 |
474 |
2,780 |
|
Total assets |
30,657 |
10,369 |
16,434 |
|
Total stockholders’ equity |
5,611 |
872 |
7,104 |
Required
A. Calculate asset turnover, profit margin, return on assets, and return on equity for each company.
B. Evaluate the relationship between asset turnover and profit margin and between return on assets and return on equity for the companies.