Profit (operating income) $6275 $3190
Sales revenue $32479 $61101
Investment (total assets) $32460 $27031 Required: a) compute the ROI for each company.
Apple ROI= _____________ % (if you get say 12.5% enter 12.5 not 12.5% or 0.125)
Dell ROI= _______________% b) use the DuPont method to decompose ROI into ROI = profit margin * asset turnover. In other words compute profit margin and asset turnover for each company:
Apple profit margin= __________ asset turnover= ____________ (Enter both as a fraction of 1 not as percentage. I.e. if the profit margin is 0.045 (4.5%) and
asset turnover is 3.42 (342%) enter 0.045 and 3.42) Dell profit margin= ____________ asset turnover= _____________
If you multiply profit margin * asset turnover you should get the ROI from part (a)
c) Which company has higher profit margin? Does it make sense based on what you know about Apple and Dell?