Here are simplified financial statements of Phone Corporation from a recent year: INCOME STATEMENT (Figures in millions of dollars) Net sales 13,200 Cost of goods sold 4,110 Other expenses 4,072 Depreciation 2,548 Earnings before interest and taxes (EBIT) Interest expense 2,470 690 1,780 Income before tax Taxes (at 35%) 623 Net income Dividends 1,157 866 BALANCE SHEET (Figures in millions of dollars) End of Year Start of Year Assets Cash and marketable securities 90 159 Receivables 2,432 2,510 Inventories 192 243 Other current assets 872 937 Total current assets Net property, plant, and equipment Other long-term assets 3,586 19,983 4,226 3,849 19,925 3,780 Total assets 27,795 27,554 Liabilities and shareholders' equity Payables Short-term debt Other current liabilities 2,574 1,424 816 3,050 1,578 792 BALANCE SHEET (Figures in millions of dollars) End of Year Start of Year Assets Cash and marketable securities 90 159 Receivables 2,432 2,510 Inventories 192 243 Other current assets 872 937 Total current assets Net property, plant, and equipment Other long-term assets 3,586 19,983 4,226 3,849 19,925 3,780 Total assets 27,795 27,554 Liabilities and shareholders' equity Payables Short-term debt Other current liabilities 2,574 1,424 3,050 1,578 792 816 Total current liabilities Long-term debt and leases Other long-term liabilities Shareholders' equity 4,814 6,769 6,188 10,024 5,420 6.654 6,159 9,321 Total liabilities and shareholders' equity 27,795 27,554 Phone Corp.'s stock price was $85 at the end of the year. There were 206 million shares outstanding. a. What was the company's market capitalization and market value added? (Enter your answers in billions rounded to 2 decimal places.) $ billion Market capitalization Market value added $ billion Total current assets Net property, plant, and equipment Other long-term assets 3,586 19,983 4,226 3,849 19,925 3,780 Total assets 27,795 27,554 Liabilities and shareholders' equity Payables Short-term debt Other current liabilities 2,574 1,424 816 3,050 1,578 792 Total current liabilities Long-term debt and leases Other long-term liabilities Shareholders' equity 4,814 6,769 6,188 10,024 5,420 6,654 6,159 9,321 Total liabilities and shareholders' equity 27,795 27,554 Phone Corp.'s stock price was $85 at the end of the year. There were 206 million shares outstanding. a. What was the company's market capitalization and market value added? (Enter your answers in billions rounded to 2 decimal places.) $ billion Market capitalization Market value added $ billion b. What was its market-to-book ratio? (Round your answer to 2 decimal places.) Market-to-book ratio
