Question:

Compute or identify the following profitability ratios of Facebook Inc. for its years ending December 31, 2019 and December 31, 2018. Interpret its profitability using the results obtained for these two years.

Profit margin ratio. Gross profit ratio. Return on total assets (Only find the ratio for 2019). Return on common stockholders equity (Only find the ratio 2019). Basic net income per common share.

Facebook Inc (Filer) CIK: 0001326801 Print Document View Excel Document 10-K Cover Cover page Dec. 31, 2019 Dec. 31, 2018 Financial Statements S (206) S (229) CONSOLIDATED BALANCE SHEETS S 0.000006 $ 0.000006 CONSOLIDATED BALANCE SHEETS (Parenthetical) CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions Current assets: Accounts receivable, allowances for doubtful accounts Stockholders' equity: Common stock, par value in dollars per share) Class A Stockholders' equity: Common stock, par value in dollars per share) Common stock, shares authorized (in shares) Common stock, shares, issued in shares) Common stock, shares, outstanding in shares) Class B Common Stock Stockholders' equity: Common stock, par value in dollars per share) Common stock, shares authorized (in shares) Common stock, shares, issued in shares) Common stock, shares, outstanding (in shares) S 0.000006 5,000,000,000 2,407,000,000 2.407,000,000 5,000,000,000 2.385,000,000 2.385,000,000 CONSOLIDATED STATEMENTS OF INCOME CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME $ 0.000006 4,141,000,000 445,000,000 445,000,000 4,141,000,000 469,000,000 469,000,000 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY CONSOLIDATED STATEMENTS OF CASH FLOWS Notes to Financial Statements Accounting Policies Notes Tables Notes Details Uncategorized All Reports Facebook Inc (Filer).CIK: 0001326801 (see all company filings) IRS No.: 201665019 | State of Incorp.: DE Fiscal Year End: 1231 Type: 10-K | Act: 34 File No.: 001-35551 Film No.: 20559618 SIC: 7370 Services Computer Programming, Data Processing, Etc. Assistant Director Office of Technology Business Address Mailing Address 1601 WILLOW ROAD 1601 WILLOW ROAD MENLO PARK CA 94025 MENLO PARK CA 94025 650-618-7714 12 Months Ended Dec. 31, 2019 Dec. 31, 2018 Dec. 31, 2017 $ 70,697 $ 55,838 $ 40,653 12,770 13,600 9,876 10,465 46,711 23,986 826 24,812 6,327 18,485 0 9,355 10,273 7,846 3,451 30,925 24,913 448 25,361 3,249 22,112 (1) 5,454 7,754 4,725 2,517 20,450 20,203 391 20,594 4,660 15,934 (14) $ 18,485 $ 22,111 $ 15,920 $6.48 $ 6.43 $ 7.65 $ 7.57 $ 5.49 $ 5.39 CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions Revenue Costs and expenses: Cost of revenue Research and development Marketing and sales General and administrative Total costs and expenses Income from operations Interest and other income, net Income before provision for income taxes Provision for income taxes Net income Less: Net income attributable to participating securities Net income attributable to Class A and Class B common stockholders Earnings per share attributable to Class A and Class B common stockholders: Basic (in dollars per share) Diluted (in dollars per share) Weighted-average shares used to compute earnings per share attributable to Class A and Class B common stockholders: Basic (in shares) Diluted (in shares) Share-based compensation expense included in costs and expenses: Share-based compensation expense Cost of revenue Share-based compensation expense included in costs and expenses: Share-based compensation expense Research and development Share-based compensation expense included in costs and expenses: Share-based compensation expense Marketing and sales Share-based compensation expense included in costs and expenses: Share-based compensation expense General and administrative Share-based compensation expense included in costs and expenses: Share-based compensation expense 2,854 2,876 2,890 2,921 2,901 2,956 $ 4,836 $ 4,152 $ 3,723 377 284 178 3,488 3,022 2,820 569 511 436 $ 402 $ 335 $ 289 12 Months Ended Dec. 31, 2019 Dec. 31, 2018 Dec. 31, 2017 S 18,485 $ 22,112 $ 15,934 5,741 4,836 (37) 39 4,315 4.152 286 (64) 3,025 3,723 (377) 24 (1,961) 47 41 (1,609) (192) 154 113 43 (1,892) (690) (159) 221 157 1,417 53 (634) 29,274 348 7,300 123 1,239 36,314 95 309 4 3,083 24 216 (15,102) (23,910) 9,565 10.152 (13,915) (14,656) 12.358 (6,733) (25,682) 9.444 988 4,772 CONSOLIDATED STATEMENTS OF CASH FLOWS- USD ($) $ in Millions Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Share-based compensation Deferred income taxes Other Changes in assets and liabilities: Accounts receivable Prepaid expenses and other current assets Other assets Accounts payable Partners payable Accrued expenses and other current liabilities Deferred revenue and deposits Other liabilities Net cash provided by operating activities Cash flows from investing activities Purchases of property and equipment, net Purchases of marketable securities Sales of marketable securities Maturities of marketable securities Acquisitions of businesses, net of cash acquired, and purchases of intangible assets Other investing activities, net Net cash used in investing activities Cash flows from financing activities Taxes paid related to net share settlement of equity awards Repurchases of Class A common stock Principal payments on finance leases Net change in overdraft in cash pooling entities Other financing activities, net Net cash used in financing activities Effect of exchange rate changes on cash, cash equivalents, and restricted cash Net increase decrease) in cash, cash equivalents, and restricted cash Cash, cash equivalents, and restricted cash at beginning of the period Cash, cash equivalents, and restricted cash at end of the period Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets Total cash, cash equivalents, and restricted cash Supplemental cash flow data Cash paid for income taxes, net Non-cash investing activities: Net change in prepaids and liabilities related to property and equipment Property and equipment in accounts payable and accrued liabilities (137) (122) (508) (61) (19,864) (25) (11,603) (13) (20.118) (3,246) (2,337) (4,202) (552) (223) 15 (3,208) (12,879) 0 500 15 (1,976) 0 0 (13) (5,235) (7,299) (15,572) 4 (179) 232 9,155 1.920 (905) 10,124 8,204 9.109 19,279 10,124 8,204 19.279 8,204 9,109 5,182 3,762 2.117 (153) 495 + 918 $ 1.887 $ 1,955 S 882 12 Months Ended Dec. 31, 2018 Dec. 31, 2019 Dec. 31, 2017 S 18,485 $ 22,112 $ 15,934 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME- USD ($) $ in Millions Statement of Comprehensive Income [Abstract] Net income Other comprehensive income (loss): Change in foreign currency translation adjustment, net of tax Change in unrealized gain/loss on available-for-sale investments and other net of tax Comprehensive income (151) (450) 566 422 (52) $ 21,610 (90) S 16,410 $ 18,756 Dec. 31, 2019 Dec. 31, 2018 $ 19,079 35,776 $ 10,019 31,095 9,518 7,587 1,852 66,225 35,323 1,779 50,480 24,683 9,460 894 18,715 2,759 133,376 1,294 18,301 2,576 97,334 820 541 CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions Current assets: Cash and cash equivalents Marketable securities Accounts receivable, net of allowances of $206 and $229 as of December 31, 2019 and December 31, 2018, respectively Prepaid expenses and other current assets Total current assets Property and equipment, net Property and equipment, net Operating lease right-of-use assets, net Intangible assets, net Goodwill Other assets Total assets Current liabilities: Accounts payable Partners payable Operating lease liabilities, current Accrued expenses and other current liabilities Deferred revenue and deposits Total current liabilities Operating lease liabilities, non-current Other liabilities Total liabilities Commitments and contingencies Stockholders' equity: Common stock, 90.000006 par value; 5,000 million Class A shares authorized, 2,407 million and 2,385 million shares issued and outstanding, as of December 31, 2019 and December 31, 2018, respectively; 4,141 million Class B shares authorized, 445 million and 469 million shares issued and outstanding, as of December 31, 2019 and December 31, 2018, respectively. Additional paid in capital Accumulated other comprehensive loss Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 1,363 886 800 11,735 269 15,053 9,524 7,745 32,322 5,509 147 7,017 0 6,190 13,207 0 0 45,851 (489) 55,692 101,054 $ 133,376 42,906 (760) 41,981 84,127 $ 97,334 Total Class A and Class Additional B Paid In Common Capital Stock Accumulated Other Retained Comprehensive Earnings Loss 2,892 $ 59,194 $0 $ 38,227 $(703) $ 21,670 2 323 323 13 13 43 0 (21) (3,246) (1,702) (1,544) 3,723 3,723 (13) CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Millions, $ in Millions Common stock, shares outstanding beginning in shares) at Dec 31, 2016 Total stockholders' equity, beginning at Dec 31, 2016 Increase (Decrease) in Stockholders' Equity [Roll Forward] Issuance of common stock related to acquisitions, shares Issuance of common stock related to acquisitions, value Issuance of common stock for cash upon exercise of stock options, shares issuance of common stock for cash upon exercise of stock options, value issuance of common stock for settlement of RSUS. shares Issuance of common stock for settlement of RSUS. value Shares withheld related to net share settlement, shares Shares withheld related to net share settlement, value Share-based compensation, related to employee share- based awards Share repurchases, shares Share repurchases, value Other comprehensive income (loss) Net income Common stock, shares outstanding ending (in shares) at Dec 31, 2017 Total stockholders' equity, ending at Dec 31, 2017 Increase (Decrease) in Stockholders' Equity [Roll Forward) Impact of the adoption of new accounting pronouncements Issuance of common stock for cash upon exercise of stock options, shares issuance of common stock for cash upon exercise of stock options, value Issuance of common stock for settlement of RSUS. shares Issuance of common stock for settlement of RSUS. value Shares withheld related to net share settlement, shares Shares withheld related to net share settlement, value Share-based compensation, related to employee share- based awards Share repurchases, shares Share repurchases, value Other comprehensive income (loss) (2,070) (2,070) 476 15,934 476 15,934 2,906 74,347 $0 40,584 (227) 33,990 141 (31) 172 2 15 15 44 0 (19) (3,208) (1,845) (1,363) 4,152 4,152 (79) (12,930) (12,930) (502) 22,112 + (502) Net income 22,112 2,854 84,127 $0 42,906 (760) 41,981 1 15 15 32 Common stock, shares outstanding ending (in shares) at Dec 31, 2018 Total stockholders' equity, ending at Dec. 31, 2018 Increase (Decrease) in Stockholders' Equity [Roll Forward] issuance of common stock for cash upon exercise of stock options, shares Issuance of common stock for cash u upon exercise of stock options, value Issuance of common stock for settlement of RSUS. shares Issuance of common stock for settlement of RSUS. value Shares withheld related to net share settlement, shares Shares withheld related to net share settlement, value Share-based compensation, related to employee share- based awards Share repurchases, shares Share repurchases, value Other comprehensive income (loss) Net income Common stock, shares outstanding ending (in shares) at Dec 31, 2019 0 (13) (675) (2,581) 4,836 (1,906) 4,836 (22) (4,099) (4,099) 271 18,485 271 18,485 2,852 ction=view&cik=1326801&accession_number=0001326801-20-000013&xbrl_type=v# View Filing Data $ 101,054 Total stockholders' equity, ending at Dec 31, 2019 SD $ 45,851 S (489) S 55,692