(a) Compute and compare the Altman Z-scores for both years. Year 2018 2019 Z-score 0 0 Information from the balance sheet, income statement, and statement of cash flows for Nike follows. Refer to these financial statements to answer the requirements. Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places. NIKE INC. Consolidated Income Statements For Year Ended (5 millions) Revenues Cost of sales Gross profit May 31, May 31, 2018 2019 $40,517 $37,797 21,643 20,441 18,874 17,356 Demand creation expense Operating overhead expense 5,153 4,977 10,349 9,334 Total selling and administrative expense 15,502 11,511 Interest expense (income), net 49 54 Other (income) expense, net Income before income taxes Income tax expense Net income (78) 3,401 66 5,725 772 2,392 $2,629 $3,333 NIKE INC. Consolidated Balance Sheets May May 31, 31, 2019 2018 $ millions (except share price) Current assets Cash and equivalents $4,466 $4,249 Short-term investments 197 996 Accounts receivable, net 4,272 3,498 Inventories 7,022 6,661 Prepaid expenses and other current assets 1,968 1,130 Total current assets 17,925 16,534 Property, plant and equipment, net 4,744 4,454 Identifiable intangible assets, net 283 285 Goodwill Deferred income taxes and other assets Total assets Current liabilities 154 154 2,011 2,509 $25,117 $23,936 Current portion of long-term debt Notes payable Accounts payable Accrued liabilities $6 $6 9 336 2,612 2,279 5,010 3,269 Income taxes payable Total current liabilities 229 150 7,866 6,040 Long-term debt 3,464 3,468 Deferred income taxes and other liabilities 3,347 3,216 Shareholders' equity Common stock at stated value: Class A convertible-315 and 329 shares outstanding 0 0 Class B-1,253 and 1,272 shares outstanding 3 3 Capital in excess of stated value 8,563 7,784 Accumulated other comprehensive income (loss) Retained earnings 231 (92) 1,643 3,517 Total shareholders' equity 10,440 11,212 Total liabilities and shareholders' equity $25,117 $23,936 Shares outstanding Company's closing stock price per share $77.14 1,253 1,272 $71.80
(a) Compute and compare the Altman Z-scores for both years. Year 2018 2019 Z-score 0 0 Information from the balance sheet, income statement, and statement of cash flows for Nike follows. Refer to these financial statements to answer the requirements. Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places. NIKE INC. Consolidated Income Statements For Year Ended (5 millions) Revenues Cost of sales Gross profit May 31, May 31, 2018 2019 $40,517 $37,797 21,643 20,441 18,874 17,356 Demand creation expense Operating overhead expense 5,153 4,977 10,349 9,334 Total selling and administrative expense 15,502 11,511 Interest expense (income), net 49 54 Other (income) expense, net Income before income taxes Income tax expense Net income (78) 3,401 66 5,725 772 2,392 $2,629 $3,333 NIKE INC. Consolidated Balance Sheets May May 31, 31, 2019 2018 $ millions (except share price) Current assets Cash and equivalents $4,466 $4,249 Short-term investments 197 996 Accounts receivable, net 4,272 3,498 Inventories 7,022 6,661 Prepaid expenses and other current assets 1,968 1,130 Total current assets 17,925 16,534 Property, plant and equipment, net 4,744 4,454 Identifiable intangible assets, net 283 285 Goodwill Deferred income taxes and other assets Total assets Current liabilities 154 154 2,011 2,509 $25,117 $23,936 Current portion of long-term debt Notes payable Accounts payable Accrued liabilities $6 $6 9 336 2,612 2,279 5,010 3,269 Income taxes payable Total current liabilities 229 150 7,866 6,040 Long-term debt 3,464 3,468 Deferred income taxes and other liabilities 3,347 3,216 Shareholders' equity Common stock at stated value: Class A convertible-315 and 329 shares outstanding 0 0 Class B-1,253 and 1,272 shares outstanding 3 3 Capital in excess of stated value 8,563 7,784 Accumulated other comprehensive income (loss) Retained earnings 231 (92) 1,643 3,517 Total shareholders' equity 10,440 11,212 Total liabilities and shareholders' equity $25,117 $23,936 Shares outstanding Company's closing stock price per share $77.14 1,253 1,272 $71.80
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter1: Starting A Proprietorship: Changes That Affect The Accounting Equation
Section: Chapter Questions
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