Google and Yahoo are close competitors in the Internet search engine business. O

Question

Google and Yahoo are close competitors in the Internet search engine business. One of Google’s top executives, Marissa Mayer, left Google in 2012 to become Yahoo’s CEO. Selected financial data for Google and Yahoo are as follows: (Enter your answers in millions rounded to 1 decimal place.)

Calculate the return on assets for both companies.

Calculate the cash return on assets for both companies.

Calculate the cash flow to sales ratio and the asset turnover ratio for both companies.

Google and Yahoo are close competitors in the Internet search engine business. One of Google’s top executives, Marissa Mayer, left Google in 2012 to become Yahoo’s CEO. Selected financial data for Google and Yahoo are as follows: (Enter your answers in millions rounded to 1 decimal place.)

Explanation / Answer

1)Return on Assets = Net Income / Average Assets Google Yahoo Net Income 13897 2517 Total assets-beginning 76905 21484 Total assets - ending 78905 21184 Average Assets ( beginning + ending)/2 77905.00 21334.00 ROA 18% 12% 2) Cash return on assets = Cas flow from operation / Average Assets Google Yahoo Cash flow from operations 17565 2632 Average Assets ( beginning + ending)/2 77905.00 21334.00 Cash return on assets 22.55% 12.34% 3) cash flow to sales ratio = operating cash flow/ net sales * 100 Google Yahoo Cash flow from operations 17565 2632 Net sales 57905 11984 Cash flow to sales ratio 30.33% 21.96% Asset turnover ratio = Net Income / Average assets Google Yahoo Net Income 13897 2517 Average Assets ( beginning + ending)/2 77905.00 21334.00 Asset turnove ratio 17.84% 11.80%

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