Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please use the following information for the next 8 questions. Below is information from reformulated financial statements for Johnson and Johnson Corporation (in millions). Operating

image text in transcribed
image text in transcribed
Please use the following information for the next 8 questions. Below is information from reformulated financial statements for Johnson and Johnson Corporation (in millions). Operating assets Short term debt securities Operating liabilities Bonds payable Boook value 2019 $4,750 475 1900) (1,585) 2,740 2018 $3,550 1,000 (795) (2,155) 1,600 Sales Operating expenses Interest revenue Interest expense Tax expense (tax rate - 30%) Earnings (net) 3.100 (2,165) 327 (413) (255) $594 Question 22 (4 points) Johnson and Johnson's short-term borrowing rate is 40% after tax Calculate ROOA (Return on operating assets) for 2019. use the average net financial obligations in calculating the after-tax implicit interest and use the average operating assets in the denominator when calculating ROOA. 18.24% 19.81% 27.37% 16.58% Question 23 (4 points) Calculate OLLEV (Operating Liability Leverage) for 2019, use the average operating liabilities and the average NOA in the calculation 0.3284 0.2566 0.5327 0.2981 Question 24 (4 points) Calculate OLSPREAD (Operating Liability Spread) for 2019. 17.82% 9.76% 14.67% 12.58% Please use the following information for the next 8 questions. Below is information from reformulated financial statements for Johnson and Johnson Corporation (in millions). Operating assets Short term debt securities Operating liabilities Bonds payable Boook value 2019 $4,750 475 1900) (1,585) 2,740 2018 $3,550 1,000 (795) (2,155) 1,600 Sales Operating expenses Interest revenue Interest expense Tax expense (tax rate - 30%) Earnings (net) 3.100 (2,165) 327 (413) (255) $594 Question 22 (4 points) Johnson and Johnson's short-term borrowing rate is 40% after tax Calculate ROOA (Return on operating assets) for 2019. use the average net financial obligations in calculating the after-tax implicit interest and use the average operating assets in the denominator when calculating ROOA. 18.24% 19.81% 27.37% 16.58% Question 23 (4 points) Calculate OLLEV (Operating Liability Leverage) for 2019, use the average operating liabilities and the average NOA in the calculation 0.3284 0.2566 0.5327 0.2981 Question 24 (4 points) Calculate OLSPREAD (Operating Liability Spread) for 2019. 17.82% 9.76% 14.67% 12.58%

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

Personal Finance

Authors: Jack Kapoor, Les Dlabay, Robert J Hughes

9th Edition

0073382329, 9780073382326

More Books

Students also viewed these Finance questions