Reference no: EM132527523

Here are simplified financial statements for Phone Corporation in a recent year:

INCOME STATEMENT(Figures in $ millions)

Net sales$13,800

Cost of goods sold 4,410

Other expenses 4,182

Depreciation 2,728

Earnings before interest and taxes (EBIT)$2,480

Interest expense 720

Income before tax$1,760

Taxes (at 35%) 616

Net income$1,144

Dividends$926

BALANCE SHEET(Figures in $ millions) End of Year Start of YearAssets

Cash and marketable securities $96 $165 Receivables 2,732 2,630

Inventories 222 273

Other current assets 902 967

Total current assets$3,952 $4,035

Net property, plant, and equipment 20,043 19,985

Other long-term assets 4,286 3,840

Total assets$28,281 $27,860

Liabilities and shareholders' equity

Payables$2,634 $3,110

Short-term debt 1,454 1,608

Other current liabilities 846 822

Total current liabilities$4,934 $5,540

Long-term debt and leases 5,275 5,580

Other long-term liabilities 6,248 6,219

Shareholders' equity 11,824 10,521

Total liabilities and shareholders' equity$28,281 $27,860

Calculate the following financial ratios for Phone Corporation: (Use 365 days in a year. Do not round intermediate calculations. Round your final answers to 2 decimal places.)

a.Return on equity (use average balance sheet figures)10.23%

b.Return on assets (use average balance sheet figures)%

c.Return on capital (use average balance sheet figures)%

d.Days in inventory (use start-of-year balance sheet figures)days

e.Inventory turnover (use start-of-year balance sheet figures)

f.Average collection period (use start-of-year balance sheet figures)days

g.Operating profit margin%h.Long-term debt ratio (use end-of-year balance sheet figures)

i.Total debt ratio (use end-of-year balance sheet figures)

j.Times interest earned

k.Cash coverage ratio

l.Current ratio (use end-of-year balance sheet figures)

m.Quick ratio (use end-of-year balance sheet figures)