Question

Compute, Disaggregate, and Interpret RNOA of Competitors Halliburton and Schlumberger compete in the oil field services sector. Refer to the following 2018 financial data for the two companies to answer the requirements. $ millions HAL SLB Total revenue $23,995 $32,815 Pretax net nonoperating expense 653 426 Net income 1,657 2,177 Average operating assets 23,361 67,836 Average operating liabilities 5,888 16,499 Marginal tax rate 22% 19% Return on equity 18.56% 5.86% a. Compute return on net operating assets (RNOA) for each company. b. Disaggregate RNOA into net operating profit margin (NOPM) and net operating asset turnover (NOAT) for each company. Do not round until your final answer. Round answers to two decimal places (percentage example: 0.12345 = 12.35%). HAL SLB RNOA 7.09 % x 3.21 % X NOPM 6.91 % x 6.63 % X NOAT 1.03 x 0.48 X

Answer 1

Answer: pgo @ Calculation do Return on wet operating assete Camboy passets CRNBA): RNOA = net operating Lo income after tar aftertar fang netopestingasets HAL SLB 13652 2,817 221. 19:1 Jaco- 2688 653 496 net operating profits aften far: Dick incomeCaftes tar) marginal tax rate Anetto.com. Chclour toi autocomeloftestant of an wenty) 924 Addi pic try set nan operating Expense net qarating Income before for meginal tax rate [net operating income before face X marginal tax rate Lnet operating income after far @ 2.77 3,114 22:1. 19:1. Lessi Tas Expense -611 -592 2.166 2,52a LAL SLB 23,361_672836 5,888 16,494 Average Net operating ossety Average operating assets Average openating tiability Laurege wet operating asset ☺ RNOA Cabo -1714643_151, 337 [12.401 4.914

6 es Net operating profit margin wet operating profits after tak Total Revenue X100 HAL SLB 2,522 23,995 32,815 Net operating income after tax Ceform) 2,166 Total Revenue Net operating profit margin 9.03%. 7.69:41 Net operating asset Turnover Total revenue ang net operating assets HAL SLR Total Revenue 23,995 32,815 Refer overage niet operating asset.com 11734E13 51,333 Net operating a asset turnour 1. 37 firmy0.64 times