Based on the above income statement data, the company’s operating profit margin and net profit margin are 5-6 of each issue of the GLO-BUS Statistical Review.Īre worth careful scrutiny by the managers of all companies because when the benchmarking data signals that a company’s costs/operating profits for one or more of the benchmarks are clearly out-of-line (or unappealing), managers are well advised to take corrective action in the next decision round.Īccording to the depreciation rates used by the company and described in the Production Cost Report, if a company adds 50 new workstations at a cost of $75,000 each and also spends $10 million for an addition to its assembly plant to accommodate the new workstations, than its annual depreciation costs will rise byĪssume a company’s Income Statement for a given period has the following entries: Sales Revenues (50,000), Production Costs (26,500), Delivery Costs (1,600), Marketing Costs (8,500), Administrative Expenses (3,000), Operating Profit (13,400), Net Interest (750), Income Before Taxes (12,650), Taxes (3,795), Net Income (8,855). The industry-low, industry-average, and industry-high benchmarks for camera costs and operating profits on pp.

Which one of the following actions is usually a dependable and appealing way for managers to try to boost their company’s EPS?Īchieve a differentiation-based competitive advantage over rivals in both the entry-level and multi-featured camera segments that company managers are savvy enough to sustain as the market demand for digital cameras grows worldwide and the company exploits its competitive advantage to win additional sales, the profit margins from a growing sales volume of entry-level and multi-featured digital cameras typically results in increase in EPS. Issue additional shares of stock and use the proceeds to pay down the debt outstanding on the company’s line of credit. Which of the following is NOT an action company co-managers can take to boost a subpar ROE? One of the benefits of pursuing a strategy of social responsibility and corporate citizenship isĪn enhanced image rating, provided company spending for socially responsible activities is meaningful and is sustained over a multi-year period. Based on the above data, which of the following statements is false?ĭelivery costs are 2.8% of revenues and represent the company’s smallest cost component.

Increasing the number of models in the company’s line of multi-featured cameras.Īssume a company’s Income Statement for a given quarter is as follows: Sales Revenues (50,000), Production Costs (26,500), Delivery Costs (1,600), Marketing Costs (8,500), Administrative Expenses (2,000), Operating Profit (14,400), Net Interest (750), Income Before Taxes (13,650), Taxes (4,095), Net Income (9,555). Which one of the following is NOT a way to improve the P/Q rating of a company’s brand of multi-featured cameras

Simulation quiz 1 globus