Chapter 14 Mini Case

When math is required, to receive full credit - SHOW YOUR MATH, otherwise you will not receive credit (even if the answer is correct). You must submit your answer on a word document or spreadsheet. Hand written responses are not acceptable and will not receive credit. Submit on Blackboard, if submitted via email or another source you will not receive credit. If submitted late (after the due date and time) you will not receive credit.

The financial statements for Nike, Inc. (NKE), are presented in Appendix E at the end of the text. The following additional information is available (in thousands):

Accounts receivable at May 31, 2015 $3,358

Inventories at May 31, 2015 4,337

Total assets at May 31, 2015 21,597

Stockholders equity at May 31, 2015 12,707

1. Determine the following measures for the fiscal year ended May 31, 2017 and May 31, 2016. Round ratios and percentages to one decimal place.

1. Working capital.

2. Current ratio.

3. Quick ratio.

4. Accounts receivable turnover.

5. Number of days sales in receivables.

6. Inventory turnover.

7. Number of days sales in inventory.

8. Ratio of liabilities to stockholders equity.

9. Asset turnover.

10. Return on total assets, assuming interest expense is $82 million for the year ending May 31, 2017 and $33 million for the year ending May 31, 2016.

11. Return on common stockholders equity.

12. Price-earnings ratio, assuming that the market price was $52.81 per share on May 31, 2017 and $54.35 on May 31, 2016.

13. Percentage relationship of net income to sales.

2. What conclusions can be drawn from these analyses? (include profitability, liquidity and solvency)