Chapter $2$ Problem $16$

a$.$ For the years $20052009,$ calculate the following for Boeing:

i$.$ Total liabilities$-$to$-$equity ratio

ii$.$ Times$-$interest$-$earned ratio

iii. Times$-$burden$-$covered ratio

b$.$ What percentage decline in earnings before interest and taxes could Boeing have sustained in these years before failing to cover:

i$.$ Interest payments?

ii$.$ Interest and principal payments?

c$.$ What do these calculations suggest about Boeing$$s financial leverage during this period?

BOEING CO$.$

BALANCE SHEET $($$ millions$)$

$20052006200720082009$

ASSETS

Cash & Short$-$Term Investments $5,9666,3869,3083,27911,223$

Net Receivables $5,6135,6556,0686,0276,153$

Inventories $7,9408,1059,56315,61216,933$

Other Current Assets $2,4492,8372,3411,046966$

Total Current Assets $21,96822,98327,28025,96435,275$

Gross Plant, Property & Equipment $19,69219,31020,18021,04221,579$

Accumulated Depreciation $11,27211,63511,91512,28012,795$

Net Plant, Property & Equipment $8,4207,6758,2658,7628,784$

Investments at Equity $849641,085942974$

Other Investments $12,40711,6419,8036,2435,522$

Intangibles $2,7994,7455,1746,3327,196$

Deferred Charges $13,251----$

Other Assets $1,1293,7867,3795,5364,302$

TOTAL ASSETS $60,05851,79458,98653,77962,053$

LIABILITIES

Long Term Debt Due In One Year $1,1891,381762560707$

Accounts Payable $5,1245,6435,7145,8717,096$

Taxes Payable $55667025341182$

Accrued Expenses $6,5906,1066,6376,16912,822$

Other Current Liabilities $14,72915,90118,17218,28412,076$

Total Current Liabilities $28,18829,70131,53830,92532,883$

Long Term Debt $9,5388,1577,4556,95212,217$

Deferred Taxes $2,067-1,190--$

Minority Interest $97$

Other Liabilities $9,2069,1979,79917,19614,728$

TOTAL LIABILITIES $48,99947,05549,98255,07359,925$

EQUITY

Common Stock $5,0615,0615,0615,0615,061$

Capital Surplus $4,3714,6554,7573,4563,724$

Retained Earnings $15,49810,23616,7809,15010,869$

Less: Treasury Stock $13,87115,21317,59418,96117,526$

TOTAL EQUITY $11,0594,7399,004(1,294)2,128$

TOTAL LIABILITIES & EQUITY $60,05851,79458,98653,77962,053$

Common Shares Outstanding $760\mathrm{.}577757\mathrm{.}836736\mathrm{.}681698\mathrm{.}138726\mathrm{.}291$

INCOME STATEMENT $($$ millions$)$

$20052006200720082009$

Sales $54,84561,53066,38760,90968,281$

Cost of Goods Sold $44,75748,92651,97748,95055,092$

Gross Profit $10,08812,60414,41011,95913,189$

Selling, General, & Administrative Exp. $6,4337,4287,3816,8529,870$

Operating Income Before Deprec. $3,6555,1767,0295,1073,319$

Depreciation, Depletion, & Amortization $1,0921,1581,1301,1791,273$

Operating Profit $2,5634,0185,8993,928 There are 3 Steps involved in it Step: 1 Get Instant Access to Expert-Tailored Solutions See step-by-step solutions with expert insights and AI powered tools for academic success Step: 2 Step: 3 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 Introduction To Personal Finance Authors: John E Grable, Lance Palmer 1st Edition 1119626633, 9781119626633 More Books Students also viewed these Finance questions Question ★★★★★ Juno Corporation had ordinary taxable income of $127,000 in the current year before consideration of any of the following property transactions. It sold two blocks of stock held for investment. One... Answered: 1 week ago Question ★★★★★ 8 Design an alternative nonprobability sample that will be more representative of infrequent and potential riders for the CityBus project. Answered: 1 week ago Question ★★★★★ 1. As the total output of a constant-cost industry increases, ________the cost does not change, so the long-run supply curve is _______ (horizontal/ positively sloped/negatively sloped). 2. A... Answered: 1 week ago Question ★★★★★ Chapter 2 Problem 1 6 a . For the years 2 0 0 5 2 0 0 9 , calculate the following for Boeing: i . Total liabilities - to - equity ratio ii . Times - interest - earned ratio iii. Times - burden -... Answered: 1 week ago Question ★★★★★ An email header includes the following fields ( select all that apply ) : TO: FROM: DATE: SUBJECT: CC: B C C : Answered: 1 week ago Question ★★★★★ Over the course of a year, the probability that a house in an urban area will be burglarized is 4%. a) If 20 houses are randomly selected, what is the probability that exactly 2 of the houses will be... Answered: 1 week ago Question ★★★★★ Identify and briefly discuss the three dimensions on which global competition takes place. 2 paragraphs or 10 sentences. Answered: 1 week ago Question ★★★★★ The tie rods in the press in Figure 3-3 are made of the steel alloy AISI 5160 OQT 900. Each rod has a diameter of 2.00 in and an initial length of 68.5 in. An axial tensile load of 40 000 lb is... Answered: 1 week ago Question ★★★★★ 7. A volcano in Hawaii is erupting and is spewing rocks and debris at a speed of 880 ft/sec at an angle of 60 degrees from the horizontal forma height of 4091 feet. Will a rock thrown from the... Answered: 1 week ago Question ★★★★★ For this assignment, select the eight demographic variables and then select ten (10) of the 71 questions and report the frequency and descriptive statistics results with interpretations. 1. The first... Answered: 1 week ago Previous Question Next Question View Answer in SolutionInn App Services Sitemap Fun Definitions Become Tutor Study Help Categories Recent Questions Expert Questions Company Info Security Copyrights Privacy Policy Terms & Conditions SolutionInn Fee Scholarship Get In Touch About Us Contact Us Career Jobs FAQ Campus Ambassador Secure Payment Download Our App © 2024 SolutionInn. All Rights Reserved $