This case concentrates on the use and interpretation of the DuPont model return on equity: return on sales, financial leverage, asset turnover, and financial ratios, in particular the following four. Students consider how these ratios are used to evaluate a business's financial performance for one year, over time, and in comparison with other companies within and outside the focal company's industry. Additionally they learn how these ratios provide insight into a company's business model via the margins it is able to get, the productivity with which it uses its assets, and the business's aggressiveness (or lack thereof) in using borrowed money to finance its operations.
The Financial Cockpit Three Levers and One Flight Plan case study solution
The case is rooted in the basic assumption that "ROE is the ratio most often used to assess profitability of a company" and it's "important to both present and future shareholders." Thus, the leading role in the case scenario, Jill Keyes, has gravitated to the DuPont replica. The case concludes with a set of inquiries that Jill Keyes has left for her succeeding follow up-these supply the fundamental assignment for students.
PUBLICATION DATE: July 29, 2010 PRODUCT #: UV5225-PDF-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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