Ratio Computation Complete the ratios using the data available for Automatic Data Processing (ADP.) Using actual financial statements introduces students to real world decisions. For example, ADP has no inventory listed, so the quick ratio is the same as the current ratio. But, should short term marketable securities be Included as cash in the cash ratio? We chose not to include them, but a strong argument can be made for its Inclusion. 2015 2014 Short-Term Solvency, or Liquidity, Measures Current ratio: Quick ratio: Cash ratio: Long-Term Solvency Measures Total debt ratio: Debt-equity ratio: Equity multiplier: Times Interest earned: Cash coverage: Asset Management, or Turnover, Measures Inventory turnover: Days' sales in Inventory Asset Management, or Turnover, Measures Inventory turnover Days' sales in inventory: Receivables turnover: Days' sales in receivables: Total asset turnover: Profitability Measures Profit margin: Return on assets (ROA): Return on equity (ROE): Commonsire Automatic Data Processing (ADP) Jun 30, 2015 in 30, 2014 REVENUES: Revenues, other than interest on funds held for clients and PEO 57,202 57,5954 revenues Interest on funds held for clients PEO revenues 2.692.5 TOTAL REVENUES 10 . EXPENSES: Operating expenses 5,635.3 5,290.8 551.2 9 5,625.3 595.4 206.9 6,427.6 2,496.9 6,041 2,3203 EXPENSES: Operating expenses Systems development and programming costs Depreciation and amortization TOTAL COSTS OF REVENUES Selling general and administrative expenses Goodwill impairment Interest expense TOTAL EXPENSES Other income, net EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES Provision for income taxes NET EARNINGS FROM CONTINUING OPERATIONS EARNINGS FROM DISCONTINUED OPERATIONS BEFORE INCOME TAXES Provision for income taxes NET EARNINGS FROM DISCONTINUED OPERATIONS NET EARNINGS Basic Earnings Per Share from Continuing Operations Basic earnings per share from discontinued operations BASIC EARNINGS PER SHARE Diluted earnings per share from continuing operations Diluted earnings per share from discontinued operations DILUTED EARNINGS PER SHARE 63.2) 2,000,7 694.2 1.376.5 1715 84417.4 170.2 1,879.2 635,6 1.242.6 414.9 1416 27. $1.515.9 $ 259 0157 2.17 257 0:57 $ 3.14 478,9 $ 1,452.5 $2.91 0.16 3.07 2.89 0.16 $ 3.05 59 - f Complete the ratios using the data available for Automatic Data Processing (ADP.) Using actual financial statements introduces students to real world decisi Basic weighted average shares outstanding Diluted weighted average shares outstanding 483.1 Jun 30, 2015 Jun 30, 2014 Commonsize SEG33 396 3 $ 1.639.3 $1,584 2,032.2 1.546.3 1.48 19,756 24,3651 28.8092 Consolidated Balance Sheets - USD (5) Sin Millions Assets Cash and cash equivalents Short-term marketable securities Accounts receivable, net Other current assets Assets of discontinued operations Total current assets before funds held for clients Funds held for clients Total current assets Long-term marketable securities Long-term receivables, net Property, Plant and Equipment, Net Other assets Goodwill Intangible assets, net Total assets Liabilities Accounts payable Accrued expenses and other current liabilities m a ll and payroll-related expenses 672.7 1.220.8 1,793.5 667.1 1.115.7 1 S 5032 33, 110.5 32,059.8 1945 152.1 6273 607.1 Complete the ratios using the data available for Automatic Data Processing (ADD) Using actual financial statements introduces students to real wo 226.4 228.6 007.1 225.9 237.1 2.173 27.2 2.463.2 9898988 8888 601.5 5.2012 18.463.4 24,167.6 24.650.5 27.113.7 Accrued payroll and payroll-related expenses Dividends payable Short-term deferred revenues Obligations under commercial paper borrowing Income taxes payable Liabilities of discontinued operations Total current liabilities before client funds obligations Client funds obligations Total current liabilities Long-term debt Other liabilities Deferred income taxes Long-term deferred revenues Total liabilities Stockholders' equity Preferred stock, $1.00 par value: Authorized, 0.3 shares; issued, none Common stock, $0.10 par value: Authorized, 1,000.0 shares; issued 638.7 shares at June 30, 2014 and June 30, 2013; outstanding. 480.2 and 482.6 shares at June 30, 2014 and 2013, respectively Capital in excess of par value Retained earnings Treasury stock at cost: 158.5 and 156.1 shares at June 30, 2014 and June 30, 2013, respectively Accumulated other comprehensive income 215.9 6443 172.1 362.7 78,302 3752 25,3896 63.9 563.3 13.4603 19.118.4) 136179 17.750) 102 1260.6) 1782