Case 3: DuPont Analysis: Playing the Numbers Game!
“Numbers! I need to see numbers!” exclaimed Andrew in response to comments made by the assistant vice-president of Finance, Jack Brown. Andrew Sullivan, the President and Chief Executive Officer of Plastichem Inc., had been instrumental in significantly increasing the company's size during his first five years in office. He spearheaded some successful marketing campaigns and revamped the production facilities by adopting the latest technology in injection molding. He also implemented various …show more content…
1. Jack Brown realizes that the first thing he must do is compare the liquidity, leverage, activity, and profitability ratios of the two companies. Using the income statement and balance sheet data shown in Tables 1–4 prepare a detailed comparison report indicating the strengths and weaknesses of each company. 2. Table 1 Plastichem Incorporated Annual Balance Sheets (Values in millions)
| |2004 |2003 |2002 |2001 |
|Current Assets |
|Cash and marketable securities