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The analyses of the net income for both companies have been done in Microsoft Office Excel and the results attached. The means, standard deviations and average growth rates were calculated using the Excel software. The mean net income for Toyota is 9,097 million Euro while that of Volkswagen is 7,522 million euro. Both companies have very large standard deviations, implying that, for the past 10 years, they have not been consistent in their businesses.
The analysis for the return on assets has also been done on Excel and it has been found out that, even though the companies almost similar mean return on assets, their average rates of return on assets are higher in Toyota than in Volkswagen.
Explanation
From the analysis, it is clear that Toyota has a higher mean net income as compared to Volkswagen. The average growth rate of Toyota is also greater than that of Volkswagen. Toyota has a lower negative value than Volkswagen. To make the comparison easier, it was important to convert the currency for Toyota from Japan Yen (JPY) to Euro (EUR).
For the past ten years, Toyota has been receiving a mean of 9,097 million euros, which is a large income compared to Volkswagen's 7,522 euros. Both companies have had significant negative net income, which have contributed to the negative annual average growth rates they have recorded. If theres need for you to know more about negative net income read an article in the http://wolfsden.org so it would be more clearer for your understanding on this analysis.
The standard deviation shows the tendency of the values to disperse from the mean. The standard deviation of the Toyota Company is much higher than Volkswagen. The smaller standard deviation indicates consistency and resilience. It may also indicate business strategy. There are small differences in the business strategies between Toyota and Volkswagen. Their countries of operation and currencies may also affect their income. Other factors including brand and product desirability can also affect the rate of return on assets, as well as the income.
Both the companies have recorded almost similar mean return on asset. The average growth rates on the return on assets for both companies are also relatively similar. However, it can be concluded from the analysis that Toyota is doing better as compared to Volkswagen. This is because of the higher mean net income and the low standard deviation in return on assets.
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