Homework Answers
Answer of Part 1:
For 2022:
Current Ratio = Current Assets / Current Liabilities
Current Ratio = $2,835 / $2,835
Current Ratio = 1:1
For 2021:
Current Ratio = Current Assets / Current Liabilities
Current Ratio = $4,850 / $4,780
Current Ratio = 1.01:1
Answer of Part 2:
For 2022:
Free Cash Flow = Cash Provided by Operations – Capital
Expenditures
Free Cash Flow = -$1,600 - $960
Free Cash Flow = -$2,560
For 2021:
Free Cash Flow = Cash Provided by Operations – Capital
Expenditures
Free Cash Flow = $2,725 - $1,355
Free Cash Flow = $1,370
Answer of Part 3:
For 2022:
Debt to Assets Ratio = Total Liabilities / Total Assets
Debt to Assets Ratio = $9,370 / $13,685
Debt to Assets Ratio = 68.47%
For 2021:
Debt to Assets Ratio = Total Liabilities / Total Assets
Debt to Assets Ratio = $9,725 / $17,360
Debt to Assets Ratio = 56.02%
Answer of Part 4:
For 2022:
EBIT = Net Income + Income Tax Expense + Interest Expenses
EBIT = $170 + $100 + $125
EBIT = $395
Times Interest Earned = EBIT / Interest Expense
Times Interest Earned = $395 / $125
Times Interest Earned = 3.16 times
For 2021:
EBIT = Net Income + Income Tax Expense + Interest Expenses
EBIT = $630 + $410 + $107
EBIT = $1,147
Times Interest Earned = EBIT / Interest Expense
Times Interest Earned = $1,147 / $107
Times Interest Earned = 10.72 times
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Problem 10-06A a Suppose you have been presented with selected information taken from the financial statements...
Problem 10-06A a Suppose you have been presented with selected information taken from the financial statements...
Problem 10-06A a Suppose you have been presented with selected information taken from the financial statements of Southwest Airlines Co., shown below. SOUTHWEST AIRLINES CO. Balance Sheet (partial) December 31 (in millions) 2022 2021 $2,760 $4,100 Total current assets 10,100 12,360 Noncurrent assets $12,860 $16,460 Total assets $2,760 $4,995 Current liabilities 5,260 6,460 Long-term liabilities Total liabilities 9,220 10,255 6,205 3,640 Shareholders' equity $12,860 $16,460 Total liabilities and shareholders' equity Other information: 2022 2021 Net income (loss) $155 575 Income...
Suppose you have been presented with selected information taken from the financial statements of Southwest Airlines...
Suppose you have been presented with selected information taken
from the financial statements of Southwest Airlines
Co., shown below.
SOUTHWEST AIRLINES CO.
Balance Sheet (partial)
December 31
(in millions)
2022
2021
Total current assets
$2,795
$4,450
Noncurrent assets
10,450
12,360
Total assets
$13,245
$16,810
Current liabilities
$2,795
$4,895
Long-term liabilities
6,495
4,990
Total liabilities
9,290
9,885
Shareholders’ equity
3,955
6,925
Total liabilities and shareholders’
equity
$13,245
$16,810
Other information:
2022
2021
Net income (loss)
$ 175
$ 565
Income tax...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 930,600 $1,057,000 Total assets 1,962,600 1,894,500 Current liabilities 423,000 377,500 Total liabilities 569,154 549,405 Net income 197,760 415,296 Net cash provided by operating activities 303,000 494,400 Capital expenditures 264,000 276,200 Dividends paid on common stock 85,000 101,100 Weighted average common shares outstanding 206,000 216,300 (a) Calculate the current ratio for...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 917,700 $910,000 Total assets 1,976,700 1,782,000 Current liabilities 437,000 350,000 Total liabilities 573,243 516,780 Net income 187,460 401,450 288,000 491,500 Net cash provided by operating activities Capital expenditures 264,000 281,500 Dividends paid on common stock 84,000 117,700 Weighted average common shares outstanding 206,000 217,000 (a) Calculate the current ratio for...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 925,359 $1,020,834 Total assets 1,963,676 1,867,680 Current liabilities 401,763 376,178 Total liabilities 554,645 527,216 Net income 179,061 400,019 Net cash provided by operating activities 302,193 464,270 Capital expenditures 265,335 250,407 Dividends paid on common stock 82,394 80,796 Weighted-average common shares outstanding 205,169 216,119 (a) Calculate the current ratio for each...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 $ 917,700 $910,000 Current assets Total assets 1,976,700 1,782,000 437,000 350,000 Current liabilities Total liabilities 573,243 516,780 Net income 187,460 401,450 288,000 Net cash provided by operating activities 491,500 Capital expenditures 264,000 281,500 117,700 Dividends paid on common stock 84,000 Weighted-average common shares outstanding 206,000 217,000 (a) Calculate the current ratio for each...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 Current assets Total assets Current liabilities Total liabilities Net income Net cash provided by operating activities Capital expenditures Dividends paid on common stock Weighted average common shares outstanding $ 880,000 1,934,000 400,000 551,190 195,840 296,000 268,000 79.000 204,000 2021 $965,900 1,834,400 371,500 522,804 425,700 496,000 279,500 108,600 215.000 (a) Calculate the current ratio for...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 880,000 $965,900 Total assets 1,934,000 1,834,400 Current liabilities 400,000 371,500 Total liabilities 551,190 522,804 Net income 195,840 425,700 Net cash provided by operating activities 296,000 496,000 Capital expenditures 268,000 279,500 Dividends paid on common stock 79,000 108,600 Weighted-average common shares outstanding 204,000 215,000 (a) Calculate the current ratio for each...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 892,500 $893,750 Total assets 1,930,500 1,709,250 Current liabilities 425,000 357,500 Total liabilities 579,150 512,775 Net income 207,900 451,410 Net cash provided by operating activities 295,000 476,500 Capital expenditures 263,000 268,300 Dividends paid on common stock 81,000 86,000 Weighted-average common shares outstanding 210,000 220,200 (a) Calculate the current ratio for each...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 865,200 $980,000 Total assets 1,897,200 1,812,000 Current liabilities 412,000 350,000 Total liabilities 531,216 507,360 Net income 189,410 414,375 Net cash provided by operating activities 335,000 486,000 Capital expenditures 300,000 270,600 Dividends paid on common stock 78,000 119,500 Weighted-average common shares outstanding 201,500 212,500 (a) Calculate the current ratio for each...
Problem 10-06A a Suppose you have been presented with selected information taken from the financial statements of Southwest Airlines Co., shown below. SOUTHWEST AIRLINES CO. Balance Sheet (partial) December 31 (in millions) 2022 2021 $2,760 $4,100 Total current assets 10,100 12,360 Noncurrent assets $12,860 $16,460 Total assets $2,760 $4,995 Current liabilities 5,260 6,460 Long-term liabilities Total liabilities 9,220 10,255 6,205 3,640 Shareholders' equity $12,860 $16,460 Total liabilities and shareholders' equity Other information: 2022 2021 Net income (loss) $155 575 Income...
Suppose you have been presented with selected information taken
from the financial statements of Southwest Airlines
Co., shown below.
SOUTHWEST AIRLINES CO.
Balance Sheet (partial)
December 31
(in millions)
2022
2021
Total current assets
$2,795
$4,450
Noncurrent assets
10,450
12,360
Total assets
$13,245
$16,810
Current liabilities
$2,795
$4,895
Long-term liabilities
6,495
4,990
Total liabilities
9,290
9,885
Shareholders’ equity
3,955
6,925
Total liabilities and shareholders’
equity
$13,245
$16,810
Other information:
2022
2021
Net income (loss)
$ 175
$ 565
Income tax...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 930,600 $1,057,000 Total assets 1,962,600 1,894,500 Current liabilities 423,000 377,500 Total liabilities 569,154 549,405 Net income 197,760 415,296 Net cash provided by operating activities 303,000 494,400 Capital expenditures 264,000 276,200 Dividends paid on common stock 85,000 101,100 Weighted average common shares outstanding 206,000 216,300 (a) Calculate the current ratio for...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 Current assets $ 917,700 $910,000 Total assets 1,976,700 1,782,000 Current liabilities 437,000 350,000 Total liabilities 573,243 516,780 Net income 187,460 401,450 288,000 491,500 Net cash provided by operating activities Capital expenditures 264,000 281,500 Dividends paid on common stock 84,000 117,700 Weighted average common shares outstanding 206,000 217,000 (a) Calculate the current ratio for...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 2021 $ 917,700 $910,000 Current assets Total assets 1,976,700 1,782,000 437,000 350,000 Current liabilities Total liabilities 573,243 516,780 Net income 187,460 401,450 288,000 Net cash provided by operating activities 491,500 Capital expenditures 264,000 281,500 117,700 Dividends paid on common stock 84,000 Weighted-average common shares outstanding 206,000 217,000 (a) Calculate the current ratio for each...
Suppose the following data were taken from the 2022 and 2021 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2022 Current assets Total assets Current liabilities Total liabilities Net income Net cash provided by operating activities Capital expenditures Dividends paid on common stock Weighted average common shares outstanding $ 880,000 1,934,000 400,000 551,190 195,840 296,000 268,000 79.000 204,000 2021 $965,900 1,834,400 371,500 522,804 425,700 496,000 279,500 108,600 215.000 (a) Calculate the current ratio for...
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