Aaron’s, Inc., and Rent-A-Center, Inc., are two publicly traded rental companies. They reported the following in their 2008 financial statements (in millions of dollars, except per share amounts and stock prices):
| Aaron’s, Inc. | Rent-A-Center, Inc. | |||
| 2008 | 2007 | 2008 | 2007 | |
| Net income | $90.2 | $80.3 | $139.6 | $76.3 |
| Total stockholders equity | 761.5 | 673.4 | 1,079.2 | 947.1 |
| Earnings per share | 1.69 | 1.48 | 2.10 | 1.11 |
| Stock price when annual results reported | 26.67 | 21.54 | 19.37 | 18.35 |
Compute the 2008 ROE for each company. Express ROE as a percentage rounded to one decimal place. Which company appears to generate greater returns on stockholders’ equity in 2008?
Tundra Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below:
| Sales | $18,700,000 |
| Net operating income | $5,900,000 |
| Average operating assets | $36,500,000 |
Compute the margin for Tundra Services Company.
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