Question

Directions: Ratio Calculation On each data tab, use formulas to calculate the following financial indicators for each year of data:

o Current ratio

o Debt/equity ratio

o Free cash flow

o Earnings per share

o Price/earnings ratio

o Return on equity

o Net profit margin

o Describe how and why each of the ratios has changed over the three-year period. For example, did the current ratio increase or decrease? Why? Describe how three of the ratios you calculated for your company compare to the general industry. Find general industry data by entering your specific company’s ticker symbol here. Be sure to watch the Mergent Online video (written instructions can be found here), as it will help you find the industry data

Below is Amazons Balance sheet for 2016 Amazon.com Inc (NMS: AMZN) Exchange rate used is that of the Year End reported date As Reported Annual Balance Sheet Report Date 12/31/2016 Currency USD Audit Status Not Qualified Consolidated Yes Scale Thousands Cash & cash equivalents 19334000 Marketable securities 6647000 Inventories 11461000 Accounts receivable, net & other current assets, gross - Less: Allowance for doubtful accounts receivable - Accounts receivable, net & other current assets, net 8339000 Total current assets 45781000 Land & buildings 13998000 Equipment & internal-use software 25989000 Other corporate assets 649000 Construction in progress 1805000 Gross property & equipment 42441000 Less accumulated depreciation 13327000 Property & equipment, net 29114000 Goodwill 3784000 Other assets 4723000 Total assets 83402000 Accounts payable 25309000 Accrued expenses & other current liabilities 13739000 Unearned revenue 4768000 Total current liabilities 43816000 Long-term debt 7694000 Long-term capital lease obligations 5080000 Long-term financing lease obligations 2439000 Construction liability 714000 Tax contingencies 1395000 Long-term deferred tax liabilities 392000 Other long-term liabilities 2587000 Other long-term liabilities 12607000 Common stock 5000 Treasury stock, at cost 1837000 Additional paid-in capital 17186000 Foreign currency translation adjustments, net of tax -1001000 Unrealized gains (loss) on available-for-sale securities, net of tax 16000 Accumulated other comprehensive income (loss) -985000 Retained earnings (accumulated deficit) 4916000 Total stockholders' equity (deficit) 19285000 Below is Amazons Income statment for 2016 Amazon.com Inc (NMS: AMZN) Exchange rate used is that of the Year End reported date As Reported Annual Income Statement Report Date 12/31/2016 Currency USD Audit Status Not Qualified Consolidated Yes Scale Thousands Net product sales 94665000 Net services sales 41322000 Total net sales 135987000 Cost of sales 88265000 Fulfillment expenses 17619000 Marketing expenses 7233000 Technology & content expenses 16085000 General & administrative expenses 2432000 Other operating expense (income), net 167000 Total operating expenses & costs 131801000 Income from operations 4186000 Interest income 100000 Interest expense 484000 Other income (expense), net 90000 Total non-operating income (expenses) -294000 Income (loss) bef income taxes- United States 24551000 Income (loss) before income taxes - International -659000 Income (loss) before income taxes 3892000 Current income taxes - U.S. federal 1136000 Current income taxes - U.S. state 208000 Current income taxes - international 327000 Total current income taxes 1671000 Deferred income taxes - U.S. federal 116000 Deferred income taxes - U.S. state -31000 Deferred income taxes - international -331000 Total deferred income taxes -246000 Provision (benefit) for income taxes 1425000 Equity-method investment activity, net of tax -96000 Net income (loss) 2371000 Weighted average shares outstanding-basic 474000 Weighted average shares outstanding-diluted 484000 Year end shares outstanding 477000 Net income (loss) per share-basic 5.01 Net income (loss) per share-diluted 4.9 Total number of employees 341400 Number of common stockholders 2448 Foreign currency translation adjustments -325000 Below is Amazons cash flow for 2016 Amazon.com Inc (NMS: AMZN)
Exchange rate used is that of the Year End reported date
As Reported Annual Cash Flow
Report Date	12/31/2016
Currency	USD
Audit Status	Not Qualified
Consolidated	Yes
Scale	Thousands
Cash & cash equivalents, beginning of period	15890000
Net income (loss)	2371000
Depreciation of property & equipment, including internal-use software & website development, & other amortization	8116000
Stock-based compensation	2975000
Other operating expense (income), net	160000
Losses (gains) on sales of marketable securities, net	-
Other expense (income), net	-20000
Deferred income taxes	-246000
Excess tax benefits from stock-based compensation	-829000
Inventories	-1426000
Accounts receivable, net & other current assets	-3367000
Accounts payable	5030000
Accrued expenses & other liabilities	1724000
Additions to unearned revenue	11931000
Amortization of previously unearned revenue	-9976000
Net cash flows from operating activities	16443000
Purchases of property & equipment, including internal-use software & website development	-6737000
Proceeds from property & equipment incentives	-
Acquisitions, net of cash acquired, & other investing activities	-116000
Sales & maturities of marketable securities	4733000
Sales & maturities of marketable securities & other investments	-
Purchases of marketable securities	-7756000
Purchases of marketable securities & other investments	-
Net cash flows from investing activities	-9876000
Excess tax benefits from stock-based compensation	829000
Proceeds from long-term debt & other financing activities	621000
Repayment of long-term debt	-
Repayments of long-term debt & other financing activities	-354000
Principal repayments of capital lease obligations	-3860000
Principal repayments of finance lease obligations	-147000
Net cash flows from financing activities	-2911000
Foreign-currency effect on cash & cash equivs	-212000
Net increase (decrease) in cash & cash equivalents	3444000
Cash & cash equivalents, end of year	19334000
Cash paid for interest	-
Cash paid for interest on long-term debt	290000
Cash paid for interest on capital & finance lease obligations	206000
Cash paid for income taxes	412000

2016
Ratio Calculations						Equations
Current ratio		/		=	#DIV/0!	current assets / current liabilities
Debt/equity ratio		/		=	#DIV/0!	total liabilities / total equity
Free cash flow		-		=	$                         -	total operating cash flow - capital expenditures
Earnings per share		/		=	#DIV/0!	net income / common shares outstanding
Price/earnings ratio		/		=	#DIV/0!	stock price / earnings per share
Return on equity		/		=	#DIV/0!	net income / total equity
Net profit margin		/		=	#DIV/0!	net income / total revenue