Question

please help

Key figures for the recent two years of both Apple and Google follow. $ millions Net income Net sales Current assets Current liabilities Apple Current Year Prior Year $ 48,351 $ 45,687 229,234 215, 639 128,645 106,869 100,814 79,006 Google Current Year Prior Year $ 12,662 $ 19,478 110,855 90,272 124,308 105,408 24,183 16,756 Required: 1. Compute profit margins for (a) Apple and (6) Google for the two years of data reported above. 2. In the current year, which company is more successful on the basis of profit margin? 3. Compute current ratios for (a) Apple and (6) Google for the two years reported above. 4. In the current year, which company has the better ability to pay short-term obligations according to the current ratio? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 In the current year, which company has the better ability to pay short-term obligations according to the current ratio? Which company has the better ability to pay short-term obligations according to the current ratio? < Required 3 Required 4 )

Answer 1

1. Profit Margin = (Net income / Net sales)*100

	Apple		Google
	Current year	Prior year	Current year	Prior year
Net income	$         48,351	$     45,687	$         12,662	$   19,478
Net sales	$     229,234	$ 215,639	$     110,855	$   90,272
Profit margin	21.09	21.19	11.42	21.58

2. In the current year, Apple company is more successful on the basis of profit margin

3. Current ratio = current assets / current liabilities (ideal current ratio is 2:1)

	Apple		Google
	Current year	Prior year	Current year	Prior year
Current assets	$       128,645	$       106,869	$       124,308	$       105,408
Current Liabilities	$       100,814	$           79,006	$           24,183	$           16,756
Current ratio	1.28	1.35	5.14	6.29

4. In the current year, Google company has the better ability to pay short term obligations according to current ratio.