Question: Hewlett-Packard and IBM are close competitors in the sale of computer products and technology consulting. Selected financial data for Hewlett-Packard and IBM are as follows:
Required: 1. Calculate the return on assets for both companies. Compare the ratios with those calculated for Apple and Dell in Illustration 11-21 .
2. Calculate the cash return on assets for both companies. Compare the ratios with those calculated for Apple and Dell in Illustration 11-22.
3. Calculate the cash flow to sales ratio and the asset turnover ratio for both companies. Which company has the better ratios, Hewlett-Packard or IBM? Are Hewlett-Packard's and IBM's business strategies closer to Apple's or to Dell's?
