3 DuPont Analysis Playing the Numbers Game Numbers! I need to see numbers!\" exc

Question

3 DuPont Analysis Playing the Numbers Game Numbers! I need to see numbers!" exclaimed Marcus in response to com- ments made by the assistant vice-president of Finance, Jeff Smith. Marcus Lenovo, president and chief executive officer of Duralex 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 cost-cutting measures and introduced performance plans to boost efficiency. Foremen and supervisors were offered stock option incentives, and bonuses were tied to earnings per share (EPS) growth Duralex Inc., a medium-sized plastic molding company, was founded in 2008 and was located in Midland, Michigan. The company supplied molded plastic products to various processing industries as well as end-users. It enjoyed a fairly diversified base of customers, ranging from automobile and home products manufacturers to the federal government. After an initial period of sluggish growth, the firm's revenues and profits had almost quadrupled. Most of the increase had been achieved under Lenovo's lead- ership. The plastics business offered potential for high profit margins, and as a result it attracted many competitors. Despite the fierce competition, Duralex's stock, which traded in the over-the-counter market, had tripled in value over the past five years, making the shareholders very happy

Explanation / Answer

The cost as a percentage of sales ratio is 74.81% for Duralex Incorporated. it has increased form 62.75% from 2014. The cost cutting measures have not shown any impact on cost.

also special income/charges is -65.8 which is due to restructuiring efforts like cost cutting and also the expense spent on marketing capmaigns.

For Apex molding, the cost as a percentage of sales ratio is 66.8% in 2015 and profit as a percentage of sales is 5.90%. Their sales have increased by 15.83% over previous year wheras for Duralex Inc , it only increaased by 1.02%.

Marcus has to spend on methods to increase sales

To assess the quality of the product

To examine the cost methods

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