Question
Following are selected account balances (in millions of dollars) from a recent UPS annual report, followed by several typical transactions. Assume that the following are
Following are selected account balances (in millions of dollars) from a recent UPS annual report, followed by several typical transactions. Assume that the following are account balances on December 31 (end of the prior fiscal year):
Account | Balance |
Account | Balance |
---|---|---|---|
Property, plant, and equipment (net) | $18,094 | Receivables | $2,599 |
Retained earnings | 13,806 | Other current assets | 1,089 |
Accounts payable | 1,677 | Cash | 1,304 |
Prepaid expenses | 318 | Spare parts, supplies, and fuel | 815 |
Accrued expenses payable | 2,490 | Other non-current liabilities | 3,920 |
Long-term notes payable | 1,910 | Other current liabilities | 2,359 |
Other non-current assets | 3,182 | Additional Paid-in Capital | 1,237 |
Common stock ($0.01 par value) | 2 |
These accounts are not necessarily in good order and have normal debit or credit balances. (Note: Because these are not all of UPS's accounts, these will not balance in a trial balance.) Assume the following transactions (in millions, except for par value) occurred the next fiscal year beginning January 1 (the current year):
- Provided delivery service to customers, who paid $11,890 in cash and owed $39,104 on account.
- Purchased new equipment costing $3,854; signed a long-term note.
- Paid $12,064 cash to rent equipment and aircraft, with $6,286 for rent this year and the rest for rent next year (a prepaid expense).
- Spent $1,284 cash to repair facilities and equipment during the year.
- Collected $36,885 from customers on account.
- Repaid $360 on a long-term note (ignore interest).
- Issued 200 million additional shares of $0.01 par value stock for $37 (thats $37 million).
- Paid employees $14,526 for work during the year.
- Purchased spare parts, supplies, and fuel for the aircraft and equipment for $12,864 cash.
- Used $7,500 in spare parts, supplies, and fuel for the aircraft and equipment during the year.
- Paid $1,204 on accounts payable.Ordered $130 in spare parts and supplies.
Compute the company's net profit margin ratio for the current year ended December 31.
\begin{tabular}{|l|l|} \hline Net profit margin ratio & \\ \hline \end{tabular}Step by Step Solution
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