Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help me solve this case Chapter 6 (page 299) Part 1: Financial Statement Analysis Case Financial Statement Analysis Case 1: Liquidity, Solvency, and DuPont

Please help me solve this case
image text in transcribed
image text in transcribed
Chapter 6 (page 299) Part 1: Financial Statement Analysis Case Financial Statement Analysis Case 1: Liquidity, Solvency, and DuPont Analysis of Nike Use Nike's, Inc.'s balance sheet and other information provided on the next page to answer the following questions. a. Compute Nike's working capital in 2019 and 2018. b. Compute Nike's current ratio in 2019 and 2018. Comment on what the working capital and current ratio indicate about Nike in 2019 and 2018. d. Compute Nike's debt-to-equity ratio for 2019 and 2018. Comment on what the debt-to-equity ratio indicates about Nike in 2019 and 2018. e. Use DuPont analysis to decompose Nike's return on equity into return on assets and financial leverage. Nike's net income in 2019 was $4,029 million. Comment on the effect of financial leverage on return on equity. c. Nike, Inc. CONSOLIDATED BALANCE SHEETS 2019 2018 (in millions) ASSETS Current Assets Cash and cash equivalents $ 4,466 $ 4,249 Accounts receivable, net 4,272 3.498 Inventories 5,622 5.261 Other current assets 2,165 2.126 Total Current Assets 16,525 15,134 Property and Equipment-net 4,744 4,454 Deferred Taxes 2,011 2,509 Goodwill 154 154 Other Intangible Assets-net 283 285 Total Assets $23,717 $22,536 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts payable $ 2,612 $ 2,279 Accrued and other liabilities 5,010 3.269 Income taxes payable 229 150 Current portion of long-term debt and notes payable 15 Total Current Liabilities 7,866 6,040 Long-Term Debt 3,464 3,468 Other Liabilities 3,347 3,216 Total Liabilities 14,667 12,724 Total Shareholders' Equity 9,040 9,812 $23,717 $22,536 Total Liabilities and Shareholders' Equity Note: Certain amounts on the balance sheet have been combined for presentation Source: https://www.sec.gov/Archives/edgar/data/320187/000032018719000051/0000320187-19-000051-index.htm 342 Chapter 6 (page 299) Part 1: Financial Statement Analysis Case Financial Statement Analysis Case 1: Liquidity, Solvency, and DuPont Analysis of Nike Use Nike's, Inc.'s balance sheet and other information provided on the next page to answer the following questions. a. Compute Nike's working capital in 2019 and 2018. b. Compute Nike's current ratio in 2019 and 2018. Comment on what the working capital and current ratio indicate about Nike in 2019 and 2018. d. Compute Nike's debt-to-equity ratio for 2019 and 2018. Comment on what the debt-to-equity ratio indicates about Nike in 2019 and 2018. e. Use DuPont analysis to decompose Nike's return on equity into return on assets and financial leverage. Nike's net income in 2019 was $4,029 million. Comment on the effect of financial leverage on return on equity. c. Nike, Inc. CONSOLIDATED BALANCE SHEETS 2019 2018 (in millions) ASSETS Current Assets Cash and cash equivalents $ 4,466 $ 4,249 Accounts receivable, net 4,272 3.498 Inventories 5,622 5.261 Other current assets 2,165 2.126 Total Current Assets 16,525 15,134 Property and Equipment-net 4,744 4,454 Deferred Taxes 2,011 2,509 Goodwill 154 154 Other Intangible Assets-net 283 285 Total Assets $23,717 $22,536 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts payable $ 2,612 $ 2,279 Accrued and other liabilities 5,010 3.269 Income taxes payable 229 150 Current portion of long-term debt and notes payable 15 Total Current Liabilities 7,866 6,040 Long-Term Debt 3,464 3,468 Other Liabilities 3,347 3,216 Total Liabilities 14,667 12,724 Total Shareholders' Equity 9,040 9,812 $23,717 $22,536 Total Liabilities and Shareholders' Equity Note: Certain amounts on the balance sheet have been combined for presentation Source: https://www.sec.gov/Archives/edgar/data/320187/000032018719000051/0000320187-19-000051-index.htm 342

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_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 Government And Not For Profit Accounting

Authors: Martin Ives, Laurence Johnson, Joseph R. Razek, Gordon A. Hosch

6th Edition

0132366355, 978-0132366359

More Books

Students also viewed these Accounting questions

Question

How do cross-sectional and longitudinal studies differ?

Answered: 1 week ago

Question

=+d. Write at least five sentences or phrases for body copy.

Answered: 1 week ago

Question

=+b. Create a tagline.

Answered: 1 week ago