Answer:
Pepsi
Profit margin = Net Income / Sales
Profit margin = $6,736/$66,466
Profit margin = 10.13%
Asset turnover = Sales / Total assets
Asset turnover = $66,466/$77,300
Asset turnover = 0.86
Equity multiplier = Total assets / Equity
Equity multiplier = $77,300 / ($77,300 - $53,143)
Equity multiplier = 3.20
Return on Equity = Profit margin * Asset turnover * Equity multiplier
Return on Equity = 10.31% * 0.86 * 3.20
Return on Equity = 0.2837312
Return on Equity = 28.40%
Equity = Total asset - Liabilities
Equity = $77,300 - $53,143
Equity = $24,157
Thus, the equity for PepsiCo is $24,157
Coca Cola
Profit margin = Net Income / Sales
Profit margin = $8449/$46,726
Profit margin = 18.08%
Asset turnover = Sales / Total assets
Asset turnover = $46726/$89902
Asset turnover = 0.52
Equity multiplier = Total assets / Equity
Equity multiplier = $88902 / ($88902 - $56900)
Equity multiplier = 2.72
Return on Equity = Profit margin * Asset turnover * Equity multiplier
Return on Equity = 18.08% * 0.52 * 2.72
Return on Equity = 0.25572352
Return on Equity = 25.60%
McDonald
Profit margin = Net Income / Sales
Profit margin = $5726/$28033
Profit margin = 20.43%
Asset turnover = Sales / Total assets
Asset turnover = $28033/$36599
Asset turnover = 0.77
Equity multiplier = Total assets / Equity
Equity multiplier = $36599 / ($36599 - $20671)
Equity multiplier = 2.30
Return on Equity = Profit margin * Asset turnover * Equity multiplier
Return on Equity = 20.43% * 0.77 * 2.30
Return on Equity = 0.3618153
Return on Equity = 36.20%
