There are many reasons to explain why companies have different financial characteristics, and the two most prominent drivers are industry economics and firm strategy. This case provide us financial data and ratios from pairs of participants in eighty different industries, and also describe strategies that they employ, such as how a product is made, how it is marketed, and so on. Our task is to match each firm’s financial data with their strategy description.

Industry 1: Health Products

The first company focuses on prescription-pharmaceuticals and invests significantly on R&D, so it has come to be seen as the partner of choice for licensing deals with other pharmaceutical and biotechnology firms. Because of its undiversified products and high invest on R&D, this firm should have less fixed assets and higher intangibles. On the other hand, the second company has diversified health-products including pharmaceuticals, consumer health and beauty products, and medical devices, so it should have higher receivables, accounts payable, and cost of goods sold. Moreover, because of its mass-market-oriented strategy, it needs to spend much money on advertising, which makes it has similar SG&A expense with first firm who is the world’s largest prescription-pharmaceutical company. Our conclusion is the first firm is B and the second firm is A (firms’ financial data see table 1).

Industry 2: Beer

The first company is a national brewer of mass-market consumer beers sold under a variety of brand names, so it must have more intangible assets than the second firm, who produces seasonal beers with smaller production volume. Moreover, the first firm is not only a brewer firm, but also involves in beer-related business, such as snack and aluminum-container manufacturing, and they even have several major theme parks, so it must have higher fixed assets. The second company looks