Question

Saved AA 13-2 Comparative Analysis LO C2, P2 Key figures for Apple and Google follow. $ millions Cash and equivalents. .... Accounts receivable, net.. Inventories......... Retained earnings.. Cost of sales. .. Revenues. . . . . Total assets. ... Apple $ 20,289 17,874 4,855 98,330 141, 048 229, 234 375, 319 Google $ 10,715 18,336 749 113,247 45,583 110,855 197, 295 nces Required: 1. Compute common-size percents for each of the companies using the data provided. 2. If Google decided to pay a dividend, would retained earnings as a percent of total assets incred 3. Which company has a higher gross margin ratio on sales? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3

Answer 1

Particulars Cash and equivalents Accounts receivables Inventories Retained Earnings Cost of sales Revenue Total Assets Apple Amount % 20289 17874 4855 98330 141048 229234 375319 Formula 5.4 D4/$C$10*100 4.8 D5/$C$10*100 1.3 D6/$C$10*100 26.2 07/$C$10*100 37.6 D8/$C$10*100 61.1 D9/$C$10*100 100.0 Google Amount % 10715 18336 749 113247 45583 110855 197295 Formula 5.4 G4/$F$10*100 9.3 G5/$F$10*100 0.4 66/$F$10*100 57.4 G7/$F$10*100 23.1 G8/$F$10*100 56.2 69/$F$10*100 100.0

Decreases Gross Margin Ratio Sno Particulars 1 Cost of sales 2 Revenue 3. Gross Profit(2-1) 4 Gross Margin Ratio % (3)/(2) Apple Google 141048 45583 229234 110855 88186 65272 38.46986 58.8805196 Conclusion: Google has Highest Gross Margin Ratio