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NIKE, INC. 2 Consolidated Statement of Income 3 In $ Millions 5 6 7 Revenues • Cost of sales . Gross profit 10 Demand creation expense 11 Operating overhead expense 12 Total selling and administrative expense 13 Interest expense (income), net 14 Other (income) expense, net Year Ended Common Sized Year over Year Change May 31 2022 May 31 2021 May 31 2020 May 31 2022 May 31 2021 May 31 2022 May 31 2021 46,710.00 44,538.00 25,231.00 24,576.00 21,479.00 19.962.00 3,850.00 10,954.00 14,804.00 205.00 -181.00 3,114.00 9.911.00 13,025.00 262.00 14.00 37,403.00 21,162.00 16,241.00 3,592.00 9,534.00 13,126.00 89.00 139.00 4.88 2.67 7.6 23.64 10.52 13.66 -21.76 -1,392.86 19.08 16.13 22.91 -13.31 3.95 -0.77 194.38 -89.93 2,172.00 655 1,517.00 736 1,043.00 1,779.00 -57 -195 7,135.00 3,414.00 3,721.00 -478 377 -101 173 -125

NIKE, INC. 2 Consolidated Statement of Income 3 In $ Millions 5 6 7 Revenues • Cost of sales . Gross profit 10 Demand creation expense 11 Operating overhead expense 12 Total selling and administrative expense 13 Interest expense (income), net 14 Other (income) expense, net Year Ended Common Sized Year over Year Change May 31 2022 May 31 2021 May 31 2020 May 31 2022 May 31 2021 May 31 2022 May 31 2021 46,710.00 44,538.00 25,231.00 24,576.00 21,479.00 19.962.00 3,850.00 10,954.00 14,804.00 205.00 -181.00 3,114.00 9.911.00 13,025.00 262.00 14.00 37,403.00 21,162.00 16,241.00 3,592.00 9,534.00 13,126.00 89.00 139.00 4.88 2.67 7.6 23.64 10.52 13.66 -21.76 -1,392.86 19.08 16.13 22.91 -13.31 3.95 -0.77 194.38 -89.93 2,172.00 655 1,517.00 736 1,043.00 1,779.00 -57 -195 7,135.00 3,414.00 3,721.00 -478 377 -101 173 -125

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
Problem 1PS
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Based on a) and b) can you answer c)
A) B) 1 2 3 4 5 6 7 8 9 10 11 12 13 15 16 17 18 19 20 C) NIKE, INC. Consolidated Statement of Income In $ Millions 4 Revenues Cost of sales Gross profit Demand creation expense Operating overhead expense Total selling and administrative expense Interest expense (income), net Other (income) expense, net Income before income taxes Income tax expense Net Income 1 NIKE, INC. 2 Consolidated Balance Sheet 3 In $ Millions 5 6 7 Current assets: 8 Cash and equivalents 9 Short-term investments 10 Accounts receivable, net 11 Inventories 12 Prepaid expenses and other current assets 13 Total current assets 14 Property, plant and equipment, net 15 Operating lease right-of-use assets, net 16 Identifiable intangible assets, net 17 Goodwill 18 Deferred income taxes and other assets. 19 Total Assets 20 21 Current liabilities: 22 Current portion of long-term debt 23 Notes payable 24 25 Accounts payable Current portion of operating lease liabilities 26 Accrued liabilities 27 Income taxes payable 28 Total current liabilities 29 Long-term debt 30 Operating lease liabilities 31 Deferred income taxes and other liabilities 32 Shareholders' equity. 33 Common stock at stated value: 38 Retained earnings (deficit) 39 Total shareholders' equity 40 Total Liabilities and Shareholders Equity 41 A NIKE, INC. 2 FINANCIAL RATIOS 36 Capital in excess of stated value 37 Accumulated other comprehensive income (loss 38 Ratio 1 6 7 34 Class A convertible - 305 and 315 shares outstanding 35 Class B-1,273 and 1,243 shares outstanding . 9 10 2 Quick Ratio 5 Current Ratio 6 7 46,710.00 44,538.00 25,231.00 24,576.00 21,479.00 19.962.00 3,850.00 3,114.00 9,911.00 13,025.00 262.00 14.00 6,661.00 934.00 5,727.00 10,954.00 14,804.00 Inventory Tumover 205.00 -181.00 6,651.00 605.00 6,046.00 Return on Total Assets Year Ended Common Sized Year over Year Change May 31 2022 May 31 2021 May 31 2020 May 31 2022 May 31 2021 May 31 2022 May 31 2021 8 Return on Equity B 8,574.00 4,423.00 4,667.00 8,420.00 2,129.00 28,213.00 4,791.00 2,926.00 286.00 284.00 3.821.00 40,321.00 500.00 10.00 3,358.00 420.00 6,220.00 222.00 10,730.00 8,920.00 2,777.00 2,613.00 D 3.00 11,484.00 318.00 3,476.00 15,281.00 40,321.00 Formula Current Assets / Cument Liabilities Total Asset Tumover Net sales / Average Total Assets D 4 Accounts Receivable Net sales/ Average accounts receivable Turnover 9,889.00 3,587.00 4,463.00 6,854.00 1,498.00 Net Income / Average Total Assets 37,403.00 21,162.00 16.241.00 26,291.00 4,904.00 3,592.00 9,534.00 13,126.00 As of Common Sized Year over Year Change May 31 2022 May 31 2021 May 31 2020 May 31 2022 May 31 2021 May 31 2022 May 31 2021 3,113.00 269.00 242.00 2,921.00 37,740.00 (Cash + Short Term Investments + Accounts Receivable) / Current Liabilities 2,836.00 467.00 6.063.00 306.00 9,674.00 9,413.00 2,931.00 2,955.00 0.00 2.00 3.00 9,965.00 -380.00 Cost of Goods Sold / Average Inventory F 3,179.00 12,767.00 37,740.00 89.00 139.00 2,887.00 348.00 2,539.00 F -1,392.86 -0.15 -35.22 5.57 8,348.00 439.00 2,749.00 7,367.00 1,653.00 20,556.00 4,866.00 3,097.00 274.00 223.00 2,326.00 31,342.00 H 3.00 248.00 2,248.00 445.00 5,184.00 156.00 8,284.00 9,406.00 2,913.00 2,684.00 12 13 + Average for any balance is computed as (beginning ending balance)/2 4.88 2.67 7.6 23.64 10.52 13.66 -21.76 3.00 8,299.00 -56.00 -191.00 8,055.00 31,342.00 H 21.26% 10.97% 11.57% 20.88% 5.28% Debt to Equity Ratio Total Liabilities/Total Stockholders Equity The debt-to-equity ratio shows the elationship between debt and equity as it lates to financing. Accounts receivable tumover measures how many times in a period (usually a year) a company will collect cash from accounts receivable 69.97% 11.88% 7.26% 0.71 % 0.70% 9.48% 100.00% 1.24% 0.02% 8.33% 1.04% 15.43% 0.55% 26.61% 22.12% 6.89% 6.48% 0.01% 28.48% 0.79% 8.62% 37.90% 100.00% Purpose The current ratio considers the amount of current assets available to cover current labilities. The higher the current ratio, the more likely the company can cover its short-term debl J The quick ratio, also known as the acid-test ratio, is similar to the current ratio except current assets are more narrowly defined as the most liquid assets, which exclude inventory and prepaid expenses. Total asset tumover measures the ability of a company to use their assets to generate revenues. A company would like to use as few assets as possible to generate the most net sales Inventory turnover measures how many times during the year a company has sold and replaced inventory. This can tell a company how well inventory is managed The return on total assets measures the company's ability to use its assets successfully to generate a profit. The higher the return (ratio outcome), the more profit is created from asset use Net Income / Average Stockholders Equity Return on equity measures the company's ability to use its invested capital to generate income. 19.08 16.13 22.91 -13.31 3.95 -0.77 194.38 -89.93 130.72 168.39 125.56 26.20% 9.50% 11.83% 18.16% 3.97% 69.66% 12.99% 8.25% 0.71% 0.64% 7.74% 100.00% 2,172.00 655 1,517.00 736 1,043.00 1,779.00 -57 -195 -10 -329 319 0.00% 0.01% 7.51% 1.24% 16.07% 0.81% 25.63% 24.94% E L 7.77% 7.83% 0.01% 26.40% -1.01% 8.42% 33.83% 100.00% -13.30% 23.31% 4.57% 22.85% 42.12% 7.31% -2.30% -6.01% 6.32% 7,135.00 3,414.00 3.721.00 -478 377 -101 173 -125 3,774.00 586 3,188.00 17.36% 30.81% 6.84% N 400.00% 18.41% -10.06% 2.59% -27.45% 10.92% -5.24% -5.25% -11.57% May 31, 2022 May 31, 2021 0.00% 15.24% -183.68% 9.34% 19.69% 6.84% N H 18.46% 717.08% 62.35% -6.96% -9.38% 27.90% 0.78% 0.52% -1.82% 8.52% 25.58% 20.41% -100.00% -99.19% 26.16% 4.94% 16.96% 96.15% 16.78% 0.07% 0.62% 10.10% 0.00% 20.07% 578.57% -1764.40% 58.50% 20.41%
Transcribed Image Text:A) B) 1 2 3 4 5 6 7 8 9 10 11 12 13 15 16 17 18 19 20 C) NIKE, INC. Consolidated Statement of Income In $ Millions 4 Revenues Cost of sales Gross profit Demand creation expense Operating overhead expense Total selling and administrative expense Interest expense (income), net Other (income) expense, net Income before income taxes Income tax expense Net Income 1 NIKE, INC. 2 Consolidated Balance Sheet 3 In $ Millions 5 6 7 Current assets: 8 Cash and equivalents 9 Short-term investments 10 Accounts receivable, net 11 Inventories 12 Prepaid expenses and other current assets 13 Total current assets 14 Property, plant and equipment, net 15 Operating lease right-of-use assets, net 16 Identifiable intangible assets, net 17 Goodwill 18 Deferred income taxes and other assets. 19 Total Assets 20 21 Current liabilities: 22 Current portion of long-term debt 23 Notes payable 24 25 Accounts payable Current portion of operating lease liabilities 26 Accrued liabilities 27 Income taxes payable 28 Total current liabilities 29 Long-term debt 30 Operating lease liabilities 31 Deferred income taxes and other liabilities 32 Shareholders' equity. 33 Common stock at stated value: 38 Retained earnings (deficit) 39 Total shareholders' equity 40 Total Liabilities and Shareholders Equity 41 A NIKE, INC. 2 FINANCIAL RATIOS 36 Capital in excess of stated value 37 Accumulated other comprehensive income (loss 38 Ratio 1 6 7 34 Class A convertible - 305 and 315 shares outstanding 35 Class B-1,273 and 1,243 shares outstanding . 9 10 2 Quick Ratio 5 Current Ratio 6 7 46,710.00 44,538.00 25,231.00 24,576.00 21,479.00 19.962.00 3,850.00 3,114.00 9,911.00 13,025.00 262.00 14.00 6,661.00 934.00 5,727.00 10,954.00 14,804.00 Inventory Tumover 205.00 -181.00 6,651.00 605.00 6,046.00 Return on Total Assets Year Ended Common Sized Year over Year Change May 31 2022 May 31 2021 May 31 2020 May 31 2022 May 31 2021 May 31 2022 May 31 2021 8 Return on Equity B 8,574.00 4,423.00 4,667.00 8,420.00 2,129.00 28,213.00 4,791.00 2,926.00 286.00 284.00 3.821.00 40,321.00 500.00 10.00 3,358.00 420.00 6,220.00 222.00 10,730.00 8,920.00 2,777.00 2,613.00 D 3.00 11,484.00 318.00 3,476.00 15,281.00 40,321.00 Formula Current Assets / Cument Liabilities Total Asset Tumover Net sales / Average Total Assets D 4 Accounts Receivable Net sales/ Average accounts receivable Turnover 9,889.00 3,587.00 4,463.00 6,854.00 1,498.00 Net Income / Average Total Assets 37,403.00 21,162.00 16.241.00 26,291.00 4,904.00 3,592.00 9,534.00 13,126.00 As of Common Sized Year over Year Change May 31 2022 May 31 2021 May 31 2020 May 31 2022 May 31 2021 May 31 2022 May 31 2021 3,113.00 269.00 242.00 2,921.00 37,740.00 (Cash + Short Term Investments + Accounts Receivable) / Current Liabilities 2,836.00 467.00 6.063.00 306.00 9,674.00 9,413.00 2,931.00 2,955.00 0.00 2.00 3.00 9,965.00 -380.00 Cost of Goods Sold / Average Inventory F 3,179.00 12,767.00 37,740.00 89.00 139.00 2,887.00 348.00 2,539.00 F -1,392.86 -0.15 -35.22 5.57 8,348.00 439.00 2,749.00 7,367.00 1,653.00 20,556.00 4,866.00 3,097.00 274.00 223.00 2,326.00 31,342.00 H 3.00 248.00 2,248.00 445.00 5,184.00 156.00 8,284.00 9,406.00 2,913.00 2,684.00 12 13 + Average for any balance is computed as (beginning ending balance)/2 4.88 2.67 7.6 23.64 10.52 13.66 -21.76 3.00 8,299.00 -56.00 -191.00 8,055.00 31,342.00 H 21.26% 10.97% 11.57% 20.88% 5.28% Debt to Equity Ratio Total Liabilities/Total Stockholders Equity The debt-to-equity ratio shows the elationship between debt and equity as it lates to financing. Accounts receivable tumover measures how many times in a period (usually a year) a company will collect cash from accounts receivable 69.97% 11.88% 7.26% 0.71 % 0.70% 9.48% 100.00% 1.24% 0.02% 8.33% 1.04% 15.43% 0.55% 26.61% 22.12% 6.89% 6.48% 0.01% 28.48% 0.79% 8.62% 37.90% 100.00% Purpose The current ratio considers the amount of current assets available to cover current labilities. The higher the current ratio, the more likely the company can cover its short-term debl J The quick ratio, also known as the acid-test ratio, is similar to the current ratio except current assets are more narrowly defined as the most liquid assets, which exclude inventory and prepaid expenses. Total asset tumover measures the ability of a company to use their assets to generate revenues. A company would like to use as few assets as possible to generate the most net sales Inventory turnover measures how many times during the year a company has sold and replaced inventory. This can tell a company how well inventory is managed The return on total assets measures the company's ability to use its assets successfully to generate a profit. The higher the return (ratio outcome), the more profit is created from asset use Net Income / Average Stockholders Equity Return on equity measures the company's ability to use its invested capital to generate income. 19.08 16.13 22.91 -13.31 3.95 -0.77 194.38 -89.93 130.72 168.39 125.56 26.20% 9.50% 11.83% 18.16% 3.97% 69.66% 12.99% 8.25% 0.71% 0.64% 7.74% 100.00% 2,172.00 655 1,517.00 736 1,043.00 1,779.00 -57 -195 -10 -329 319 0.00% 0.01% 7.51% 1.24% 16.07% 0.81% 25.63% 24.94% E L 7.77% 7.83% 0.01% 26.40% -1.01% 8.42% 33.83% 100.00% -13.30% 23.31% 4.57% 22.85% 42.12% 7.31% -2.30% -6.01% 6.32% 7,135.00 3,414.00 3.721.00 -478 377 -101 173 -125 3,774.00 586 3,188.00 17.36% 30.81% 6.84% N 400.00% 18.41% -10.06% 2.59% -27.45% 10.92% -5.24% -5.25% -11.57% May 31, 2022 May 31, 2021 0.00% 15.24% -183.68% 9.34% 19.69% 6.84% N H 18.46% 717.08% 62.35% -6.96% -9.38% 27.90% 0.78% 0.52% -1.82% 8.52% 25.58% 20.41% -100.00% -99.19% 26.16% 4.94% 16.96% 96.15% 16.78% 0.07% 0.62% 10.10% 0.00% 20.07% 578.57% -1764.40% 58.50% 20.41%
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