Selected balance sheet and income statement information from Illinois Tool Works follows. $ millions 2019 2018 2017 Net operating profit after tax (NOPAT) $2,897 $3,009 Net income 2,798 2,845 Total assets 15,671 15,465 $17,451 Equity 3,147 3,384 3,384 Net operating profit after tax (NOA) 9,224 9,840 10,493 Treasury stock 21,070 19,475 17,274 a. Compute profitability measures: RNOA, ROA and ROE for 2019 and 2018 using the numbers as reported by the company. Note: Round answers to one decimal place (ex: 0.2345 = 23.5%). Metric 2019 2018 RNOA Answer Answer ROA Answer Answer ROE Answer Answer b. Adjust equity and total assets for the amount of treasury stock. $ millions 2019 2018 2017 Assets, restated Answer Answer Answer Equity, restated Answer Answer Answer Using these restated numbers, recompute RNOA, ROA and ROE for both years. Note: Round answers to one decimal place (ex: 0.2345 = 23.5%). Metric 2019 2018 RNOA Answer Answer ROA Answer Answer ROE Answer Answer
Selected balance sheet and income statement information from Illinois Tool Works follows. $ millions 2019 2018 2017 Net operating profit after tax (NOPAT) $2,897 $3,009 Net income 2,798 2,845 Total assets 15,671 15,465 $17,451 Equity 3,147 3,384 3,384 Net operating profit after tax (NOA) 9,224 9,840 10,493 Treasury stock 21,070 19,475 17,274 a. Compute profitability measures: RNOA, ROA and ROE for 2019 and 2018 using the numbers as reported by the company. Note: Round answers to one decimal place (ex: 0.2345 = 23.5%). Metric 2019 2018 RNOA Answer Answer ROA Answer Answer ROE Answer Answer b. Adjust equity and total assets for the amount of treasury stock. $ millions 2019 2018 2017 Assets, restated Answer Answer Answer Equity, restated Answer Answer Answer Using these restated numbers, recompute RNOA, ROA and ROE for both years. Note: Round answers to one decimal place (ex: 0.2345 = 23.5%). Metric 2019 2018 RNOA Answer Answer ROA Answer Answer ROE Answer Answer
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 32BEB
Related questions
Question
Compute and Interpret Ratios
Selected balance sheet and income statement information from Illinois Tool Works follows.
| $ millions | 2019 | 2018 | 2017 |
|---|---|---|---|
| $2,897 | $3,009 | ||
| Net income | 2,798 | 2,845 | |
| Total assets | 15,671 | 15,465 | $17,451 |
| Equity | 3,147 | 3,384 | 3,384 |
| Net operating profit after tax (NOA) | 9,224 | 9,840 | 10,493 |
| 21,070 | 19,475 | 17,274 |
a. Compute profitability measures: RNOA,
Note: Round answers to one decimal place (ex: 0.2345 = 23.5%).
| Metric | 2019 | 2018 |
|---|---|---|
| RNOA | Answer
|
Answer
|
| ROA | Answer
|
Answer
|
| ROE | Answer
|
Answer
|
b. Adjust equity and total assets for the amount of treasury stock.
| $ millions | 2019 | 2018 | 2017 |
|---|---|---|---|
| Assets, restated | Answer
|
Answer
|
Answer
|
| Equity, restated | Answer
|
Answer
|
Answer
|
Using these restated numbers, recompute RNOA, ROA and ROE for both years.
Note: Round answers to one decimal place (ex: 0.2345 = 23.5%).
| Metric | 2019 | 2018 |
|---|---|---|
| RNOA | Answer
|
Answer
|
| ROA | Answer
|
Answer
|
| ROE | Answer
|
Answer
|
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