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Management Accounting
Willie Seal, University of Essex, UK
Ray Garrison, Brigham Young University, Provo, Utah, USA
Eric Noreen, INSEAD, France

Profit Planning and the role of budgeting

Internet Exercises

www: IE12-37 Return on Investment (ROI) Analysis ROI is the product of a company's margin and turnover. In this exercise you will be computing margin, turnover, and ROI using data from the annual reports of several companies. Before starting on this exercise, you should know that in some cases it won't be completely clear which assets should be considered operating assets. Don't worry about this. Do the best you can and just be consistent from year to year within the same company.

On the web site of each company below, you should be able to find directions to the company's annual report (sometimes referred to as Form 10-K). Using data from the company's two most recent annual reports, compute the company's margin, turnover, and ROI for the two most recent years. Using these ratios briefly discuss the company's performance.

1.      Apple Computer, www.apple.com

2.      Campbell Soup, www.campbellsoup.com

3.      Hershey Foods, www.hersheys.com.

4.      Sprint, www.sprint.com