For the company Nike Inc. Assume that the chief financial officer (CFO) has asked you to analyze the use of company assets and make recommendations for revenue generation and increasing profitability. Take a look at the Form 10-k. Review and study the assets as reported for the past 3 years. Using the correct formulas and a separate tab for each analysis, calculate the following ratios using Excel. Receivables turnover Average collection period Inventory turnover Average days in inventory Asset turnover

	12 months ended	May 31, 2019		May 31, 2018		May 31, 2017		May 31, 2016		May 31, 2015		May 31, 2014
	Revenues	39,117		36,397		34,350		32,376		30,601		27,799
	Cost of sales	(21,643)		(20,441)		(19,038)		(17,405)		(16,534)		(15,353)
	Gross profit	17,474		15,956		15,312		14,971		14,067		12,446
	Demand creation expense	(3,753)		(3,577)		(3,341)		(3,278)		(3,213)		(3,031)
	Operating overhead expense	(8,949)		(7,934)		(7,222)		(7,191)		(6,679)		(5,735)
	Selling and administrative expense	(12,702)		(11,511)		(10,563)		(10,469)		(9,892)		(8,766)
	Operating income	4,772		4,445		4,749		4,502		4,175		3,680
	Interest income	82		70		27		12		6		5
	Interest expense	(131)		(124)		(86)		(31)		(34)		(38)
	Interest income (expense), net	(49)		(54)		(59)		(19)		(28)		(33)
	Other income (expense), net	78		(66)		196		140		58		(103)
	Income before income taxes	4,801		4,325		4,886		4,623		4,205		3,544
	Income tax expense	(772)		(2,392)		(646)		(863)		(932)		(851)
	Net income	4,029		1,933		4,240		3,760

Using the results of your ratio calculations, provide recommendations about how to improve one of these assets: receivables, inventory, or property, plant, and equipment for the company, as a means of generating revenue and increasing profitability. Include discussion and explanation of the following within the memo. Summarize how well the company is collecting on its receivables based upon the type(s) of products the company sells and the industry in which it competes. Justify your speculation by using supporting facts from the income statement, balance sheet, or other resources. Summarize how effective the company is in managing inventory based upon the type(s) of products the company sells and the industry in which it competes. Include discussion about whether the inventory turnover ratio is increasing or decreasing, what is causing the ratio increase/decrease, and whether the total value of inventory is increasing or decreasing on the balance sheet. Summarize how well the company is utilizing its assets to generate net income. Justify your assessment with examples of other ratios and values on the income statement and balance sheet. Make a recommendation to improve one of these assets: receivables, inventory, or property, plant, and equipment. Use information from the ratio calculations, income statement, balance sheet, or other resources to justify your recommendation and explain how accepting the recommendation will generate revenue and increase company profitability.

Market Summary > Nike Inc.

NYSE: NKE

103.00 USD +2.98 (2.98%)

Closed: Feb 12, 5:53 PM EST · Disclaimer

After hours 102.95 −0.050 (0.049%)

5 years

46.02 USD  ‎Feb 13, 2015

Open	100.74
High	103.08
Low	100.44
Mkt cap	127.96B
P/E ratio	36.09

Div yield	0.95%
Prev close	100.02
52-wk high	105.62
52-wk low	77.07