The balance sheet and income statement shown below are for Alcoa. Note that the
ID: 2704306 • Letter: T
Question
The balance sheet and income statement shown below are for Alcoa. Note that the firm has no amortization charges and it does not lease any assets and none of its debt must be retired during the next 5 years, although the notes payable will be rolled over.
Balance Sheet (Millions of $)
Assets 2007
Cash and securities $1,554.0
Accounts receivable 9,660.0
Inventories 14,440.0
Total current assets $25,654.0
Net plant and equipment 17,346.0
Total assets $43,000.0
Liabilities and Equity
Accounts payable $7,980.0
Notes payable 6,880.0
Accruals 4,620.0
Total current liabilities $19,480.0
Long-term bonds 10,920.0
Total debt $30,400.0
Common stock 3,360.0
Retained earnings 9,240.0
Total common equity $12,600.0
Total liabilities and equity $43,000.0
Income Statement (Millions of $) 2007
Net sales $58,800.00
Operating costs except depr
Explanation / Answer
Equity multiplier=total asset/total equity
=43000/12600=3.413
debt ratio=total debt/toatal asset
=30400/43000=0.707
Cash flow per share=1554/175=8.88
book value per share=17346/175=99.12
profit margin=1133/58800=1.93%
P/E ratio=77.69/6.47=12.01
EBITDA coverage=EBITDA/Int.exp
=3822/1050=3.64
total asset turnover=58800/43000=1.37
quick ratio=(25654-14440)/19480=0.57
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