42. For fiscal year 2011, Starbucks Corporation (SBUX) had total revenues of $11.70 billion, net income of $1.25 billion, total assets of $7.36 billion, and total shareholder’s equity of $4.38 billion.

• a. Calculate the Starbucks’ ROE directly, and using the DuPont Identity.
• b. Comparing with the data for Peet’s in Problem 41, use the DuPont Identity to understand the difference between the two firms’ ROEs.

Q2

See Table 2.5 showing financial statement data and stock price data for Mydeco Corp.

• a. How did Mydeco’s accounts receivable days change over this period?
• b. How did Mydeco’s inventory days change over this period?
• c. Based on your analysis, has Mydeco improved its management of its working capital during this time period?

• TABLE 2.5 2009–2013 Financial Statement Data and Stock Price Data for Mydeco Corp.

  Mydeco Corp. 2009–2013	(All data as of fiscal year end; in $ million)
  Income Statement	2009	2010	2011	2012	2013
  Revenue Cost of Goods Sold	404.3 (188.3)	363.8 (173.8)	424.6 (206.2)	510.7 (246.8)	604.1 (293.4)
  Gross Profit Sales and Marketing Administration Depreciation & Amortization	216.0 (66.7) (60.6) (27.3)	190.0 (66.4) (59.1) (27.0)	218.4 (82.8) (59.4) (34.3)	263.9 (102.1) (66.4) (38.4)	310.7 (120.8) (78.5) (38.6)
  EBIT Interest Income (Expense)	61.4 (33.7)	37.5 (32.9)	41.9 (32.2)	57.0 (37.4)	72.8 (39.4)
  Pretax Income Income Tax	27.7   (9.7)	4.6 (1.6)	9.7 (3.4)	19.6 (6.9)	33.4 (11.7)
  Net Income    Shares outstanding (millions)    Earnings per share	18.0  55.0  $0.33	3.0 55.0 $0.05	6.3 55.0 $0.11	12.7 55.0 $0.23	21.7 55.0 $0.39
  Balance Sheet	2009	2010	2011	2012	2013
  Assets Cash Accounts Receivable Inventory	48.8 88.6 33.7	68.9 69.8 30.9	86.3 69.8 28.4	77.5 76.9 31.7	85.0 86.1 35.3
  Total Current Assets Net Property, Plant & Equip. Goodwill & Intangibles	171.1 245.3 361.7	169.6 169.6 243.3	184.5 309 361.7	186.1 345.6 361.7	206.4 347.0 361.7
  Total Assets Liabilities & Stockholders’ Equity Accounts Payable Accrued Compensation	778.1   18.7  6.7	774.6   17.9 6.4	855.2   22.0 7.0	893.4   26.8 8.1	915.1   31.7 9.7
  Total Current Liabilities Long-term Debt	25.4 500.0	24.3 500.0	29.0 575.0	34.9 600.0	41.4 600.0
  Total Liabilities Stockholders’ Equity	525.4 252.7	524.3 250.3	604.0 251.2	634.9 258.5	641.4 273.7
  Total Liabilities & Stockholders’ Equity	778.1	774.6	855.2	893.4	915.1
  Statement of Cash Flows	2009	2010	2011	2012	2013
  Net Income Depreciation & Amortization Chg. in Accounts Receivable Chg. in Inventory Chg. in Payables & Accrued Comp.	18.0 27.3 3.9 (2.9) 2.2	3.0 27.0 18.8 2.8 (1.1)	6.3 34.3 (0.0) 2.5 4.7	12.7 38.4 (7.1) (3.3) 5.9	21.7 38.6 (9.2) (3.6) 6.5
  Cash from Operations Capital Expenditures	48.5 (25.0)	50.5 (25.0)	47.8 (100.0)	46.6 (75.0)	54.0 (40.0)
  Cash from Investing Activities Dividends Paid Sale (or purchase) of stock Debt Issuance (Pay Down)	(25.0) (5.4) — —	(25.0) (5.4) — —	(100.0) (5.4) — 75.0	(75.0) (5.4) — 25.0	(40.0) (6.5) — —
  Cash from Financing Activities	(5.4)	(5.4)	69.6	19.6	(6.5)
  Change in Cash	18.1	20.1	17.4	(8.8)	7.5
  Mydeco Stock Price	$7.92	$3.30	$5.25	$8.71	$10.89