Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Given the 2019 ratios of Verizon wireless what do EACH of these ratios indicate about the company specifically? (not just as a whole) 2.

1. Given the 2019 ratios of Verizon wireless what do EACH of these ratios indicate about the company specifically? (not just as a whole)

2. Lastly, at the end, in one paragraph what do these calculations (all together) mean for the companies financial health?

Answers must be broken down into everyday language and not in "financial talk"

  • Profit ratios:
    gross profit margin (gross profit / sales)*100
    gross profit 77142000
    sales 131868000
    gross profit margin 58.50%
    operating profit margin (operating profit / sales)*100
    operating profit 30564000
    sales 131868000
    operating profit margin 23.18%
    net profit margin (net income / sales)*100
    net income 19265000
    sales 131868000
    net profit margin 14.61%
    Liquidity ratios:
    current ratio current assets / current liabilities
    current assets 37473000
    current liabilities 44868000
    current ratio 0.84
    quick ratio cash+net receivable / current liabilities
    cash 2594000
    net receivable 25429000
    total 28023000
    current liabilities 44868000
    quick ratio 0.62
    cash ratio (cash and cash equivalent + short term investments) / current liabilities
    cash and cash equivalent 2594000.00
    current liabilities 44868000
    cash ratio 0.06
    Activity ratios:
    receivable turnover ratio sales / ending receivable
    sales 131868000
    ending receivable 25429000
    receivable turnover ratio 5.19
    days sales outstanding 365 days / receivable turnover ratio
    receivable turnover ratio 5.19
    days sales outstanding 70.33
    inventory turnover ratio cost of goods sold / ending inventory
    cost of goods sold 54726000
    ending inventory 1422000
    inventory turnover ratio 38.49
    inventory days 365 days / inventory turnover
    inventory turnover 38.49
    inventory days 9.48
    Leverage ratios:
    debt ratio total debt / total assets
    long-term debt 100712000
    total assets 291727000
    debt ratio 0.35
    debt-to-equity total debt / total equity
    long-term debt 100712000
    total equity 61395000
    debt-to-equity 1.64
    shareholder return ratio net income / total equity
    net income 19265000
    total equity 61395000
    shareholder return ratio 0.31

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cost Management A Strategic Emphasis

Authors: Edward Blocher, David Stout, Paul Juras, Gary Cokins

6th Edition

78025532, 978-0077523732, 77523733, 978-0078025532

Students also viewed these Accounting questions