Profitability Measures for Kimberly-Clark Corporation
Profitability Measures for Kimberly-Clark Corporation (Easy) Below are summary numbers from reformulate d balance sheets for 2007 and 2006 for Kimberly-Clark Corporation, the paper product company, along with numbers from the reformulated income statement for 2007 (in millions).
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a. Calculate the following for 2007 and 2006:
(1) Net operating assets
(2) Net financial obligations
(3) Shareholders' equity
b. Calculate return on common equity (ROCE ), return on net operating assets (RNOA), financial leverage (FLEV), and net borrowing cost (NBC) for 2007. Use beginning of period balance sheet numbers in denominators.
c. Show that the financing leverage equation works with your calculations.
d. Calculate the operating profit margin (PM) and asset turnover (ATO) for 2007 and show that RNOA = PM x ATO. Sales for 2007 were $18,266 million.
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Posted 27 Jul 2017 11:07 AM
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A-----------nsw-----------er ----------- A)----------- 1.----------- Fo-----------r 2-----------007----------- : -----------Net----------- op-----------era-----------tin-----------g a-----------sse-----------ts -----------= (-----------180-----------55------------ 60-----------11.-----------8) -----------=12-----------045-----------.2 -----------For----------- 20-----------06 -----------: N-----------et -----------ope-----------rat-----------ing----------- as-----------set-----------s =----------- (1-----------679-----------6.2------------59-----------27.----------- 2-----------) =----------- 10-----------869----------- 2)----------- Fo-----------r 2-----------007----------- Ne-----------t f-----------ina-----------nci-----------al -----------obl-----------iga-----------tio-----------n =----------- (6-----------496-----------.4------------382-----------.7)----------- = -----------611-----------3.7----------- Fo-----------r 2-----------006----------- Ne-----------t f-----------ina-----------nci-----------al -----------obl-----------iga-----------tio-----------n =----------- (4-----------395-----------.4------------270-----------.8)----------- = -----------412-----------4.6----------- -----------3) -----------For----------- 20-----------07 -----------Sha-----------reh-----------old-----------ers----------- eq-----------uit-----------y =----------- (1-----------204-----------5.2------------61-----------13.-----------7)=----------- 59-----------31.-----------5 F-----------or -----------200-----------6 s-----------har-----------eho-----------lde-----------rs -----------equ-----------ity----------- = -----------(18-----------069------------41-----------24.-----------6) -----------= 1-----------394-----------4.4----------- B)----------- RO-----------CE -----------= (-----------274-----------0.1-----------/13-----------944-----------.4)-----------*10-----------0 =----------- 19-----------.65-----------% R-----------NOA----------- = -----------(27-----------40.-----------1/1-----------086-----------9)*-----------100-----------
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