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Here are simplified financial statements for Phone Corporation in 2020: INCOME STATEMENT (Figures in $ millions) Net sales Cost of goods sold Other expenses Depreciation Earnings before interest and taxes (EBIT) Interest expense Income before tax Taxes (at 21%) Net income Dividends BALANCE SHEET $ 12,600 3,760 4,127 2,338 $ 2,375 - 655 $ 1,720 361 $ 1,359 $ 816

Here are simplified financial statements for Phone Corporation in 2020: INCOME STATEMENT (Figures in $ millions) Net sales Cost of goods sold Other expenses Depreciation Earnings before interest and taxes (EBIT) Interest expense Income before tax Taxes (at 21%) Net income Dividends BALANCE SHEET $ 12,600 3,760 4,127 2,338 $ 2,375 - 655 $ 1,720 361 $ 1,359 $ 816

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Here are simplified financial statements for Phone Corporation in 2020: INCOME STATEMENT (Figures in $ millions) Net sales Cost of goods sold Other expenses Depreciation Earnings before interest and taxes (EBIT) Interest expense Income before tax Taxes (at 21%) Net income Dividends Assets Cash and marketable securities Receivables Inventories 1200 Other current assets Total current assets Net property, plant, and equipment Other long-term assets Total assets. BALANCE SHEET (Figures in $ millions) Liabilities and shareholders' equity Payables Short-term debt $ 12,600 3,760 4,127 2,338 $ 2,375 -655 $ 1,720 361 $ 1,359 $ 816 Other current liabilities Total current liabilities Long-term debt and leases Other long-term liabilities Shareholders' equity Total liabilities and shareholders' equity End of Year Start of Year a. Return on equity (use average balance sheet figures) b. Return on assets (use average balance sheet figures) c. Return on capital (use average balance sheet figures) d. Days in inventory (use start-of-year balance sheet figures) e. Inventory turnover (use start-of-year balance sheet figures) f. Average collection period (use start-of-year balance sheet figures) g. Operating profit margin h. Long-term debt ratio (use end-of-year balance sheet figures) i. Total debt ratio (use end-of-year balance sheet figures) j. Times interest earned k. Cash coverage ratio 1. Current ratio (use end-of-year balance sheet figures) m. Quick ratio (use end-of-year balance sheet figures) $83 2,082 157 837 $ 3,159 19,913 4,156 $ 27,228 $ 2,504 1,389 781 $ 4,674 8,512 6,118 7,924 $ 27,228 $152 2,370 208 902 $ 3,632 19,855 3,710 $ 27,197 $ 2,980 1,543 757 $ 5,280 7,907 6,089 7,921 $ 27,197 Calculate the following financial ratios for Phone Corporation: Note: Use 365 days in a year. Do not round intermediate calculations. Round your final answers to 2 decimal places 14.11% 4.11 % 10.68 % 20.19 days 18.08 68.65 days 18.85 % 0.54 0.71 3.63 7.20 0.68 0.64
Transcribed Image Text:Here are simplified financial statements for Phone Corporation in 2020: INCOME STATEMENT (Figures in $ millions) Net sales Cost of goods sold Other expenses Depreciation Earnings before interest and taxes (EBIT) Interest expense Income before tax Taxes (at 21%) Net income Dividends Assets Cash and marketable securities Receivables Inventories 1200 Other current assets Total current assets Net property, plant, and equipment Other long-term assets Total assets. BALANCE SHEET (Figures in $ millions) Liabilities and shareholders' equity Payables Short-term debt $ 12,600 3,760 4,127 2,338 $ 2,375 -655 $ 1,720 361 $ 1,359 $ 816 Other current liabilities Total current liabilities Long-term debt and leases Other long-term liabilities Shareholders' equity Total liabilities and shareholders' equity End of Year Start of Year a. Return on equity (use average balance sheet figures) b. Return on assets (use average balance sheet figures) c. Return on capital (use average balance sheet figures) d. Days in inventory (use start-of-year balance sheet figures) e. Inventory turnover (use start-of-year balance sheet figures) f. Average collection period (use start-of-year balance sheet figures) g. Operating profit margin h. Long-term debt ratio (use end-of-year balance sheet figures) i. Total debt ratio (use end-of-year balance sheet figures) j. Times interest earned k. Cash coverage ratio 1. Current ratio (use end-of-year balance sheet figures) m. Quick ratio (use end-of-year balance sheet figures) $83 2,082 157 837 $ 3,159 19,913 4,156 $ 27,228 $ 2,504 1,389 781 $ 4,674 8,512 6,118 7,924 $ 27,228 $152 2,370 208 902 $ 3,632 19,855 3,710 $ 27,197 $ 2,980 1,543 757 $ 5,280 7,907 6,089 7,921 $ 27,197 Calculate the following financial ratios for Phone Corporation: Note: Use 365 days in a year. Do not round intermediate calculations. Round your final answers to 2 decimal places 14.11% 4.11 % 10.68 % 20.19 days 18.08 68.65 days 18.85 % 0.54 0.71 3.63 7.20 0.68 0.64
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