Answer
The “net cash flow less capital expenditure” percentage changes are the most favourable because they move from a negative change of -4.5% between 2012 and 2013 to a positive growth of 3.5% between 2013 and 2014. This is the only performance which depicts a positive growth.
The net earnings depict the least favourable growth, from an 88% growth between 2012 and 2013 to a decline of 65% between 2013 and 2014
The percentage changes show that Kellogg’s performance is not impressive. The company needs to reevaluate its core activities and expenditures to ensure positive growth in its net earnings; otherwise, its survival and going concern status may be hampered by the declines in performance, as indicated in the percentage changes between 2013 and 2014.
Work Step by Step
Analysis based on computations in (a).
