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Using the information above, can you find the cost of debt and equity AND/OR the weight of equity and weight of debt: Year Ended May
Using the information above, can you find the cost of debt and equity AND/OR the weight of equity and weight of debt:
Year Ended May 31 (in millions of dollars except per-share data) Revenues Cost of goods sold Gross profit Selling and administrative Operating income Interest expense Other expense, net Restructuring charge, net Income before income taxes Income taxes Net income Diluted earnings per common share Average shares outstanding (diluted) Growth (%) Revenue Operating income Net income Margins (%) Gross margin Operating margin Net margin Exhibit 1 Nike, Inc.: Cost of Capital Consolidated Income Statements 1995 $ 1996 1.36 $ 294.0 t t 39.5 36.7 649.9 899.1 1,295.2 250.2 345.9 499.4 $ 399.7 $ 553.2 $ 795.8 CO C $4,760.8 $6,470.6 $9,186.5 $9,553.1 $8,776.9 $8,995.1 $ 9,488.8 2,865.3 3,906.7 5,503.0 6,065.5 5,493.5 5,403.8 5,784.9 1,895.6 2,563.9 3,683.5 3,487.6 3.283.4 3,591.3 3,703.9 1,209.8 1,588.6 2,303.7 2,623.8 2,426.6 2,606.4 2,689.7 685.8 975.3 1,379.8 863.8 24.2 856.8 984.9 1,014.2 44.1 11.7 21.5 45.1 746.1 919.2 921.4 294.7 340.1 331.7 $399.6 $ 451.4 $ 579.1 $ 589.7 1997 35.9 42.2 38.4 1.88 $ 2.68 $ 293.6 297.0 39.6 15.1 52.3 32.3 8.5 42.0 41.5 1998 40.1 15.0 8.7 60.0 20.9 129.9 653.0 253.4 4.0 (37.4) 43.9 (49.8) 1.35 $ 296.0 20 36.5 9.0 4.2 Effective tax rate (%)* 38.5 38.6 38.8 *The U.S. statutory tax rate was 35%. The state tax varied yearly from 2.5% to 3.5%. Sources of data: Company filing with the Securities and Exchange Commission (SEC), UBS Warburg. 1999 1.57 $ 287.5 (8.1) (0.8) 13.0 37.4 9.8 5.1 2000 39.5 45.0 23.2 (2.5) 2.07 S 279.8 2.5 15.0 28.3 39.9 10.9 6.4 2001 37.0 58.7 34.1 2.16 273.3 5.5 3.0 1.8 39.0 10.7 6.2 36.0
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To calculate the cost of debt and equity as well as the weights of equity and debt for Nike Inc we will use the information provided in the exhibits C...Get Instant Access to Expert-Tailored Solutions
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