Purchase Solution

Profitability Measures; Liquidity Measures; Activity Measures; Financial Leverage Measures; Physical Measures

Not what you're looking for?

Ask Custom Question

Required:

a. Compute the following profitability measures for the year ended
December 29, 2001:

1. Return on investment, based on net income (perform a DuPont analysis).
2. Return on equity, based on net income.
3. Price/earnings ratio. Use $32.24 as the year-end market price.
4. Dividend yield.
5. Dividend payout ratio.

b. Compute the following liquidity measures at December 29, 2001:

1. Working capital.
2. Current ratio.
3. Acid-test ratio.

c. Compute the following activity measures for the year ended December 29,
2001:

1. Number of days' sales in accounts receivable, based on a 365-day year.
2. Number of days' sales in inventory, based on a 365-day year.
3. Accounts receivable turnover.
4. Inventory turnover.
5. Turnover of net property, plant, and equipment.

d. Compute the following financial leverage measures at December 29, 2001:

1. Debt ratio.
2. Debt/equity ratio.
3. Times interest earned.

e. Compute the following physical measures of Intel's profitability at
December 29, 2001:

1. Net revenues per employee.
2. Operating income per employee.

(Hint: The number of employees at year-end is disclosed on page 12 of the
Intel annual report in the Appendix.)

*See attachments for complete details.

Purchase this Solution

Solution Preview

Please refer to the attachment.

Ratio analysis-comprehensive problem, 2001 data. This problem is based on the 2001 annual report of Intel Corporation, in the Appendix.

(The 2001 Intel Annual Report can be found here: http://www.intel.com/intel/annual01/index.htm and the financials can be found here: http://www.intel.com/intel/annual01/01financials.pdf )

Required:

a. Compute the following profitability measures for the year ended
December 29, 2001:

1. Return on investment, based on net income (perform a DuPont analysis).
By DuPont analysis,
ROI = Net income/ Gross book value
= Net Income / (stockholders' equity + long-term debt)
= 1291/ (35830+1050) = 3.5%

2. Return on equity, based on net income.
ROI = Net income/ stockholders' equity = 1291/ 35830 = ...

Purchase this Solution


Free BrainMass Quizzes
Employee Orientation

Test your knowledge of employee orientation with this fun and informative quiz. This quiz is meant for beginner and advanced students as well as professionals already working in the HR field.

Transformational Leadership

This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.

Situational Leadership

This quiz will help you better understand Situational Leadership and its theories.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.