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Assess Credit Risk (LO2, 3)

Balance sheets and income statements for NextEra Energy, Inc. follow. Refer to these financial state-ments to answer the requirements

Required

a. Use the financial statements and the information below to compute the following profitability and coverage, liquidity and solvency ratios for 2012 and 2011: RNOA, ROE, times interest earned, free cash flow to debt, current ratio, quick ratio, liabilities-to-equity ratio, and total debt-to-equity ratio. (For simplicity here, use year-end balances for the denominator of RNOA and ROE.) Comment on any observed trends

b. Summarize your findings in a conclusion about the companys credit risk. Do you have any concerns about the companys ability to meet its debt obligations?

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