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Practice Question ...And while UPS casily beat carnings expectations and predicted a rising profit margin in the U.S. for the fourth quarter, FedEx signaled that

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Practice Question "...And while UPS casily beat carnings expectations and predicted a rising profit margin in the U.S. for the fourth quarter, FedEx signaled that its profit margin will fall further. The lack of workers is taking a toll on its reliability too. FedEx's recent on-time performance for express and ground packages has sunk to 85%, while UPS has met deadlines on 95% of those packages, according to data collected by ShipMatrix Inc." (Businessweek, November 8, 2021" UPS and Fedex, two rivals that have seen revenues increased dramatically during the pandemic, have experienced different magnitude of changes in stock price recently. The closing price of UPS on December 3, 2021 was at $200.73, almost double from two years ago, while Fedex had a 50% increase during the same period, landing at $240.84. The P/E ratio of UPS is at 129.50, while Fedex at 12.17. Investors and analysts have shown a strong interest in paying higher price multiples in UPS stock compared to Fedex stock. UPS most recent financial statements (for the year ended December 31, 2020, thereafter, 2020) and Fedex most recent financial statements (for the year ended May 31, 2021, thereafter, 2021) Refer to these two sets of financial statements and answer the following questions. 1) Based on the information in the financial statements, compute and enter your final answer of the following ratios in the table listed in the template. (Note: make sure to show your calculation process. You may do so by typing the calculation process below the table or manually writing it down on a separate page) 2) Comment on the relative liquidity, solvency and profitability of these two competitors, UPS Fedex Liquidity ratio a) Current ratio b) Accounts receivable turnover (Assume all sales were credit sales) c) Average collection period Solvency ratios a) Debt to assets ratio b) Times interest earned c) Free cash flows Profitability ratios a) Profit margin b) Assets turnover c) Return on assets

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