ADM 1340 Chapter Notes - Chapter 10: Financial Instrument, Inventory Turnover, Harmonized Sales Tax
ADM 1340 Full Course Notes
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What are the coverage ratios for the following data (using formula below)? Please show how you came up with solution. Thank you Times interest earned = EBIT / Interest expense = ?? Times burden covered = EBIT / Interest + Principal repayment / 1 - tax rate = ??
MICROSOFT CORP BALANCE SHEET | ||
2014 | 2015 | |
Assets | ||
Cash | ||
Cash and cash equivalents | $8,669 | $5,595 |
Short-term investments | $77,040 | $90,931 |
Total cash | $85,709 | $96,526 |
Receivables | $19,544 | $17,908 |
Inventories | $2,660 | $2,902 |
Deferred income taxes | $1,941 | $1,915 |
Other current assets | $4,392 | $5,461 |
Total current assets | $114,246 | $124,712 |
Non-current assets | ||
Gross property, plant and equipment | $27,804 | $32,337 |
Accumulated Depreciation | -$14,793 | -$17,606 |
Net property, plant and equipment | $13,011 | $14,731 |
Equity and other investments | $14,597 | $12,053 |
Goodwill | $20,127 | $16,939 |
Intangible assets | $6,981 | $4,835 |
Other long-term assets | $3,422 | $2,953 |
Total non-current assets | $58,138 | $51,511 |
Total assets | $172,384 | $176,223 |
Liabilities and stockholders' equity | ||
Liabilities | ||
Current liabilities | ||
Short-term debt | $2,000 | $7,484 |
Accounts payable | $7,432 | $6,591 |
Taxes payable | $782 | $606 |
Accrued liabilities | $4,797 | $5,096 |
Deferred revenues | $23,150 | $23,223 |
Other current liabilities | $7,464 | $6,858 |
Total current liabilities | $45,625 | $49,858 |
Non-current liabilities | ||
Long-term debt | $20,645 | $27,808 |
Deferred taxes liabilities | $2,728 | $2,835 |
Deferred revenues | $2,008 | $2,095 |
Other long-term liabilities | $11,594 | $13,544 |
Total non-current liabilities | $36,975 | $46,282 |
Total liabilities | $82,600 | $96,140 |
Stockholders' equity | ||
Common stock | $68,366 | $68,465 |
Retained earnings | $17,710 | $9,096 |
Accumulated other comprehensive income | $3,708 | $2,522 |
Total stockholders' equity | $89,784 | $80,083 |
Total liabilities and stockholders' equity | $172,384 | $176,223 |
MICROSOFT CORP INCOME STATEMENT | ||
(USD in millions except per share data) | 2014 | 2015 |
Revenue | $86,833 | $93,580 |
Cost of revenue | $26,934 | $33,038 |
Gross profit | $59,899 | $60,542 |
Operating expenses | ||
Research and development | $11,381 | $12,046 |
Sales, General and administrative | $20,632 | $20,324 |
Restructuring, merger and acquisition | $127 | $0 |
Other operating expenses | $0 | $10,011 |
Total operating expenses | $32,140 | $42,381 |
Operating income | $27,759 | $18,161 |
Interest Expense | $597 | $781 |
Other income (expense) | $658 | $1,127 |
Income before taxes | $27,820 | $18,507 |
Provision for income taxes | $5,746 | $6,314 |
Net income from continuing operations | $22,074 | $12,193 |
Net income | $22,074 | $12,193 |
Net income available to common shareholders | $22,074 | $12,193 |
Earnings per share | ||
Basic | $2.66 | $1.49 |
Diluted | $2.63 | $1.48 |
Weighted average shares outstanding | ||
Basic | $8,299 | $8,177 |
Diluted | $8,399 | $8,254 |
EBITDA | $33,629 | $25,245 |
MICROSOFT CORP CASH FLOW STATEMENT | ||
(USD in millions except per share data) | 2014 | 2015 |
Cash Flows From Operating Activities | ||
Net income | $22,074 | $12,193 |
Depreciation & amortization | $5,212 | $5,957 |
Investment/asset impairment charges | $0 | $7,498 |
Investments losses (gains) | -$109 | -$443 |
Deferred income taxes | -$331 | $224 |
Stock based compensation | $2,446 | $2,574 |
Accounts receivable | -$1,120 | $1,456 |
Inventory | -$161 | -$272 |
Accounts payable | $473 | -$1,054 |
Other working capital | $1,432 | $1,383 |
Other non-cash items | $2,315 | -$436 |
Net cash provided by operating activities | $32,231 | $29,080 |
Cash Flows From Investing Activities | ||
Investments in property, plant, and equipment | -$5,485 | -$5,944 |
Acquisitions, net | -$5,937 | -$3,723 |
Purchases of investments | -$72,690 | -$98,729 |
Sales/Maturities of investments | $65,366 | $85,861 |
Other investing activities | -$87 | -$466 |
Net cash used for investing activities | -$18,833 | -$23,001 |
Cash Flows From Financing Activities | ||
Debt issued | $10,350 | $10,680 |
Debt repayment | -$3,888 | -$1,500 |
Common stock issued | $607 | $634 |
Common stock repurchased | -$7,316 | -$14,443 |
Excess tax benefit from stock based compensation | $271 | $588 |
Dividend paid | -$8,879 | -$9,882 |
Other financing activities | $461 | $4,843 |
Net cash provided by (used for) financing activities | -$8,394 | -$9,080 |
Effect of exchange rate changes | -$139 | -$73 |
Net change in cash | $4,865 | -$3,074 |
Cash at beginning of period | $3,804 | $8,669 |
Cash at end of period | $8,669 | $5,595 |
Free Cash Flow | ||
Operating cash flow | $32,231 | $29,080 |
Capital expenditure | -$5,485 | -$5,944 |
Free cash flow | $26,746 | $23,136 |
What are the coverage ratios for the following data (using formula below) for 2015 and 2016? Please show how you came up with solution. Thank you Times interest earned = EBIT / Interest expense = ?? Times burden covered = EBIT / Interest + Principal repayment / 1 - tax rate = ??​ (PLEASE SHOW WORK SO I CAN UNDERSTAND HOW THIS WAS DONE. Thank you
AMAZON.COM INC (AMZN) CashFlowFlag INCOME STATEMENT | ||
Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
Revenue | 107006 | 135987 |
Cost of revenue | 71651 | 88265 |
Gross profit | 35355 | 47722 |
Operating expenses | ||
Sales, General and administrative | 20411 | 27284 |
Other operating expenses | 12711 | 16252 |
Total operating expenses | 33122 | 43536 |
Operating income | 2233 | 4186 |
Interest Expense | 459 | 484 |
Other income (expense) | -206 | 190 |
Income before income taxes | 1568 | 3892 |
Provision for income taxes | 950 | 1425 |
Other income | -22 | -96 |
Net income from continuing operations | 596 | 2371 |
Net income | 596 | 2371 |
Net income available to common shareholders | 596 | 2371 |
Earnings per share | ||
Basic | 1.28 | 5.01 |
Diluted | 1.25 | 4.9 |
Weighted average shares outstanding | ||
Basic | 467 | 474 |
Diluted | 477 | 484 |
EBITDA | 8308 | 12492 |
AMAZON.COM INC (AMZN) CashFlowFlag BALANCE SHEET | ||
Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
Assets | ||
Current assets | ||
Cash | ||
Cash and cash equivalents | 15890 | 19334 |
Short-term investments | 3918 | 6647 |
Total cash | 19808 | 25981 |
Receivables | 6423 | 8339 |
Inventories | 10243 | 11461 |
Deferred income taxes | ||
Total current assets | 36474 | 45781 |
Non-current assets | ||
Property, plant and equipment | ||
Land | 9770 | 13998 |
Fixtures and equipment | 18417 | 25989 |
Other properties | 1866 | 2454 |
Property and equipment, at cost | 30053 | 42441 |
Accumulated Depreciation | -8215 | -13327 |
Property, plant and equipment, net | 21838 | 29114 |
Goodwill | 3759 | 3784 |
Intangible assets | ||
Deferred income taxes | 1084 | |
Other long-term assets | 2289 | 4723 |
Total non-current assets | 28970 | 37621 |
Total assets | 65444 | 83402 |
Liabilities and stockholders' equity | ||
Liabilities | ||
Current liabilities | ||
Accounts payable | 20397 | 25309 |
Accrued liabilities | 10384 | 13739 |
Deferred revenues | 3118 | 4768 |
Total current liabilities | 33899 | 43816 |
Non-current liabilities | ||
Long-term debt | 8235 | 7694 |
Capital leases | 5948 | 7519 |
Deferred taxes liabilities | 392 | |
Other long-term liabilities | 3978 | 4696 |
Total non-current liabilities | 18161 | 20301 |
Total liabilities | 52060 | 64117 |
Stockholders' equity | ||
Common stock | 5 | 5 |
Additional paid-in capital | 13394 | 17186 |
Retained earnings | 2545 | 4916 |
Treasury stock | -1837 | -1837 |
Accumulated other comprehensive income | -723 | -985 |
Total stockholders' equity | 13384 | 19285 |
Total liabilities and stockholders' equity | 65444 | 83402 |
AMAZON.COM INC (AMZN) Statement of CASH FLOW | ||
Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
Cash Flows From Operating Activities | ||
Net income | 596 | 2371 |
Depreciation & amortization | 6281 | 8116 |
Investments losses (gains) | 5 | |
Deferred income taxes | 81 | -246 |
Stock based compensation | 2119 | 2975 |
Accounts receivable | -1755 | -3367 |
Inventory | -2187 | -1426 |
Accounts payable | 4294 | 5030 |
Accrued liabilities | 913 | 1724 |
Other working capital | 1292 | 1955 |
Other non-cash items | 281 | -689 |
Net cash provided by operating activities | 11920 | 16443 |
Cash Flows From Investing Activities | ||
Investments in property, plant, and equipment | -4589 | -6737 |
Acquisitions, net | -795 | -116 |
Purchases of investments | -4091 | -7756 |
Sales/Maturities of investments | 3025 | 4733 |
Net cash used for investing activities | -6450 | -9876 |
Cash Flows From Financing Activities | ||
Long-term debt issued | 353 | 621 |
Long-term debt repayment | -4235 | -4361 |
Excess tax benefit from stock based compensation | 119 | 829 |
Repurchases of treasury stock | ||
Net cash provided by (used for) financing activities | -3763 | -2911 |
Effect of exchange rate changes | -374 | -212 |
Net change in cash | 1333 | 3444 |
Cash at beginning of period | 14557 | 15890 |
Cash at end of period | 15890 | 19334 |
Free Cash Flow | ||
Operating cash flow | 11920 | 16443 |
Capital expenditure | -4589 | -6737 |
Free cash flow | 7331 | 9706 |
Supplemental schedule of cash flow data | ||
Cash paid for income taxes | 273 | 412 |
Cash paid for interest | 478 | 496 |
NIKE:
Need the following ratios to be calculated using the financial sheets copied at the bottom. Each ratio needs to be calculated using the information from 2016. Each ratio also needs to be broken down and illustrated by the step by step process. Finally, please include any and all observations for each ratio and analysis.
1) Common Size analysis
2) Common size vertical analysis & graph
3) Current Ratio
4) Quick Ratio
5) Cash Ratio
6) Inventory Turnover
7) Receivables Turnover
8) Total Asset Turnover
9) Fixed Asset Turnover
10) Gross profit margin
11) Operating Profit margin
12) Net profit margin
13) Return on total assets
14) return on equity
15) basic earning power
16) Deb/net worth ratio
17) debt ratio
18) DuPont System
19) Times-interest-earned
Balance Sheet:
Consolidated Balance Sheets - USD ($) $ in Millions | May 31, 2017 | May 31, 2016 |
Current assets: | ||
Cash and equivalents | $ 3,808 | $ 3,138 |
Short-term investments | 2,371 | 2,319 |
Accounts receivable, net | 3,677 | 3,241 |
Inventories | 5,055 | 4,838 |
Prepaid expenses and other current assets | 1,150 | 1,489 |
Total current assets | 16,061 | 15,025 |
Property, plant and equipment, net | 3,989 | 3,520 |
Identifiable intangible assets, net | 283 | 281 |
Goodwill | 139 | 131 |
Deferred income taxes and other assets | 2,787 | 2,422 |
TOTAL ASSETS | 23,259 | 21,379 |
Current liabilities: | ||
Current portion of long-term debt | 6 | 44 |
Notes payable | 325 | 1 |
Accounts payable | 2,048 | 2,191 |
Accrued liabilities | 3,011 | 3,037 |
Income taxes payable | 84 | 85 |
Total current liabilities | 5,474 | 5,358 |
Long-term debt | 3,471 | 1,993 |
Deferred income taxes and other liabilities | 1,907 | 1,770 |
Commitments and contingencies | ||
Redeemable preferred stock | 0 | 0 |
Shareholders’ equity: | ||
Capital in excess of stated value | 8,638 | 7,786 |
Accumulated other comprehensive (loss) income | (213) | 318 |
Retained earnings | 3,979 | 4,151 |
Total shareholders’ equity | 12,407 | 12,258 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 23,259 | 21,379 |
Class A Convertible Common Stock | ||
Shareholders’ equity: | ||
Common stock at stated value | 0 | 0 |
Class B Common Stock | ||
Shareholders’ equity: | ||
Common stock at stated value | $ 3 | $ 3 |
Income Statement:
Consolidated Statements of Income - USD ($) $ in Millions | 12 Months Ended | ||
May 31, 2017 | May 31, 2016 | May 31, 2015 | |
Income Statement [Abstract] | |||
Revenues | $ 34,350 | $ 32,376 | $ 30,601 |
Cost of sales | 19,038 | 17,405 | 16,534 |
Gross profit | 15,312 | 14,971 | 14,067 |
Demand creation expense | 3,341 | 3,278 | 3,213 |
Operating overhead expense | 7,222 | 7,191 | 6,679 |
Total selling and administrative expense | 10,563 | 10,469 | 9,892 |
Interest expense (income), net | 59 | 19 | 28 |
Other (income) expense, net | (196) | (140) | (58) |
Income before income taxes | 4,886 | 4,623 | 4,205 |
Income tax expense | 646 | 863 | 932 |
NET INCOME | $ 4,240 | $ 3,760 | $ 3,273 |
Earnings per common share: | |||
Basic (in dollars per share) | $ 2.56 | $ 2.21 | $ 1.90 |
Diluted (in dollars per share) | 2.51 | 2.16 | 1.85 |
Dividends declared per common share (in dollars per share) | $ 0.70 | $ 0.62 | $ 0.54 |
Cash Flow Sheet
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
May 31, 2017 | May 31, 2016 | May 31, 2015 | |
Cash provided by operations: | |||
Net income | $ 4,240 | $ 3,760 | $ 3,273 |
Income charges (credits) not affecting cash: | |||
Depreciation | 706 | 649 | 606 |
Deferred income taxes | (273) | (80) | (113) |
Stock-based compensation | 215 | 236 | 191 |
Amortization and other | 10 | 13 | 43 |
Net foreign currency adjustments | (117) | 98 | 424 |
Changes in certain working capital components and other assets and liabilities: | |||
(Increase) decrease in accounts receivable | (426) | 60 | (216) |
(Increase) in inventories | (231) | (590) | (621) |
(Increase) in prepaid expenses and other current assets | (120) | (161) | (144) |
(Decrease) increase in accounts payable, accrued liabilities and income taxes payable | (364) | (889) | 1,237 |
Cash provided by operations | 3,640 | 3,096 | 4,680 |
Cash used by investing activities: | |||
Purchases of short-term investments | (5,928) | (5,367) | (4,936) |
Maturities of short-term investments | 3,623 | 2,924 | 3,655 |
Sales of short-term investments | 2,423 | 2,386 | 2,216 |
Investments in reverse repurchase agreements | 0 | 150 | (150) |
Additions to property, plant and equipment | (1,105) | (1,143) | (963) |
Disposals of property, plant and equipment | 13 | 10 | 3 |
Other investing activities | (34) | 6 | 0 |
Cash used by investing activities | (1,008) | (1,034) | (175) |
Cash used by financing activities: | |||
Net proceeds from long-term debt issuance | 1,482 | 981 | 0 |
Long-term debt payments, including current portion | (44) | (106) | (7) |
Increase (decrease) in notes payable | 327 | (67) | (63) |
Payments on capital lease and other financing obligations | (17) | (7) | (19) |
Proceeds from exercise of stock options and other stock issuances | 489 | 507 | 514 |
Excess tax benefits from share-based payment arrangements | 177 | 281 | 218 |
Repurchase of common stock | (3,223) | (3,238) | (2,534) |
Dividends — common and preferred | (1,133) | (1,022) | (899) |
Cash used by financing activities | (1,942) | (2,671) | (2,790) |
Effect of exchange rate changes on cash and equivalents | (20) | (105) | (83) |
Net increase (decrease) in cash and equivalents | 670 | (714) | 1,632 |
Cash and equivalents, beginning of year | 3,138 | 3,852 | 2,220 |
CASH AND EQUIVALENTS, END OF YEAR | 3,808 | 3,138 | 3,852 |
Cash paid during the year for: | |||
Interest, net of capitalized interest | 98 | 70 | 53 |
Income taxes | 703 | 748 | 1,262 |
Non-cash additions to property, plant and equipment | 266 | 252 | 206 |
Dividends declared and not paid | $ 300 | $ 271 | $ 240 |