Solution-Which company seems to be doing the better job

Which company seems to be doing the better job

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Reference no: EM131826878

Question - Lennox International makes air conditioning, heating, and fireplace systems for residential and commercial uses, as well as commercial refrigeration equipment. American Standard Companies is a leading maker of air conditioning systems, plumbing products, and automotive braking systems. Selected financial statement data and asset utilization ratios for each company follow:

American Standard Companies
	Year 1	Year2	Year 3
Sales	$7,598,370	$7,465,300	$7,795,400
ROA	0.09	0.08	0.09
Current Assets Turnover	4.22	3.96	3.99
Fixed (long-term) asset turnover	2.61	2.57	2.57
Total Assets Turnover	1.61	1.56	1.56

Lennox International
	Year 1	Year2	Year 3
Sales	$3,242,204	$3,113,649	$3,025,767
ROA	0.05	(0.01)	0.05
Current Assets Turnover	3.62	3.86	4.36
Fixed (long-term) asset turnover	3.33	2.79	3.14
Total Assets Turnover	1.73	1.62	1.83

Compare the asset utilization effectiveness of these two companies. Which company seems to be doing the better job? Are any important industry trends apparent from these data?

Reference no: EM131826878

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Which company seems to be doing the better job

Reference no: EM131826878

Reference no: EM131826878

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