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interest and taxes

/in /by

Question

   Earnings before interest and taxes (EBIT) $ 2,430   

  Interest expense 670       Income before tax $ 1,760     Taxes (at 35%) 616       Net income $ 1,144     Dividends $ 846    

BALANCE SHEET
(Figures in $ millions)
  End of Year Start of Year 
  Assets         
     Cash and marketable securities $86  $155  
     Receivables  2,232   2,430  
     Inventories   172   223  
     Other current assets  852   917  
    
        Total current assets $3,342  $3,725  
     Net property, plant, and equipment  19,943   19,885  
     Other long-term assets  4,186   3,740  
    
        Total assets $27,471  $27,350  
    
  Liabilities and shareholders’ equity         
     Payables $2,534  $3,010  
     Short-term debt  1,404   1,558  
     Other current liabilities  796   772  
    
        Total current liabilities $4,734  $5,340  
     Long-term debt and leases  7,765   7,370  
     Other long-term liabilities  6,148   6,119  
     Shareholders’ equity  8,824   8,521  
    
        Total liabilities and shareholders’ equity $27,471  $27,350  
    
Calculate the following financial ratios for Phone Corporation: (Use 365 days in a year. Do not round intermediate calculations. Round your percentage answers “Return on equity”, “Return on assets”, Return on capital” and “Operating profit margin” to 2 decimal places and the rest to 2 decimal places.)
 
 
 
     
a.Return on equity (Use average equity.) %
b.Return on assets (Use after-tax operating income and average assets.) %
c.Return on capital (Use after-tax operating income and average capital.) %
d.Days in inventory (Use beginning inventory.) days
e.Inventory turnover (Use beginning inventory.) 
f.Average collection period (Use beginning receivables.) days
g.Operating profit margin (Use after-tax operating income.) %
h.Long-term debt ratio (Use end of year values.) 
i.Total debt ratio (Use end of year values.) 
j.Times interest earned 
k.Cash coverage ratio 
l.Current ratio (Use end of year values.) 
m.Quick ratio (Use end of year values.) 
 
 
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