Accessing SEC reports and Calculating Ratios

Access the 2012 financial reports at the SEC

websites for Pfizer Inc. and Merck & Co., two close competitors in the pharmaceutical industry.

Pfizer’s financial reports are available here: Pfizer 2012 financial reports

Merick’s financial reports are available here: Merck 2012 financial reports

a. Use data from the companies’ balance sheets and income statements to complete the following table.

$ millions Pfizer Merck Total assets $Answer

$Answer

Revenue Answer

Answer

Net incomeAnswer

Answer

b. Compute the ROA and the components for profit margin and asset turnover for each company.

Round answers to two decimal places (example: 0.12345 = 12.35%).

To simplify computations,


use year-end balance for total assets


to compute ratios.

Pfizer Merck Return on assets (ROA) Answer

% Answer

% Profit margin (PM) Answer

% Answer

% Asset turnover (AT)Answer

Answer