Mba 604

Week 2 Cases C4-4 and C5-1 Carlos Carmona January 22, 2012 Benedictine University C4-4 Please See given over Excel Document C5-1 1. Which order was the to a greater extent winningsable in 2006? (Hint: comparability hard roe and ROA murder for the both food product retailers.) Concentrating first function on a comparing hard roe, the Kroger club performed better than Safeway in 2006. This is because Krogers roe was 23.9% in par to 16.4% for Safeway. Nevertheless, the ROA outcome of the two companies that seduce was very similar. 1. In at 6.4% for Kroger 2. In at 6.0% for Safeway 2. What was the apt(predicate) source of that companys passkey meshwork performance in 2006? (Hint: Decompose ROE and ROA into their individual agent parts.) When we muster up the answer to the first research we already tangibleize that practically of Krogers higher ROE performance in 2006 is comprise as a advantageous effect of pecuniary leverage. present are the findings for question 2: 1. The CLM (Combined Leverage Multiplier) for Kroger that year was 3.720 (= 4.477 monetary structure leverage X 0.831 common mesh leverage). In contrast to a CLM of 2.745 for Safeway. 2. Kroger has greater ROA performance at 6.4% in comparison to 6.0%. However they do have a weaker lucre margin at 2.0% vs. 2.4%.

Kroger overpowers this profit margin flunk by displaying quicker asset upset at 3.171 (Kroger) vs. 2.509 (Safeway). 3. Which company was the to a greater extent profitable in 2004? Safeway has superior ROE (14.1%) and ROA (6.4%) in 2004 when compared to Kroger (-2.7% and 5.5%, respectively). 4. both(prenominal) companies have EBI/Sales margins that resonate around 2%. What face of the retail grocery constancy contributes to such unhopeful margins? We should apologise that there are real amounts of complexity in the retail grocery industry because it is super competitive; so many a(prenominal) compensating factors contribute to the success of entrants. Customers do-nothing buy mark or private label items and meats from many competing grocery...If you want to grasp a full essay, order it on our website: Ordercustompaper.com

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