12 Months Ended Consolidated Statements of Operations - USD ($) shares in Millio

Question

12 Months Ended Consolidated Statements of Operations - USD ($) shares in Millions. $ in Millions Dec. 31, 2016 Dec. 31, 2015 Operating Revenues [Abstract] Regulated electric Nonregulated electric and other Regulated natural gas Total operating revenues Operating Expenses [Abstract] $21,221 659 863 22,743 $21,379 456 536 22,371 7,355 6,625 265 6,085 3.294 1.142 Fuel used in electric generation and purchased power Cost of natural gas 141 Operation, maintenance and other Depreciation and amortization Property and other taxes Impairment charges Total operating expenses 5,539 3,053 1,129 18 106 17,323 17,429 27 5,341 30 Gains( Losses) on Sales of Other Assets and Other, net Operating Income 5,078 Other Income and Expenses [Abstract] Equity in earnings (losses) olf unconsolidated affiliates Other income and expenses, net (15) 69 290 359 1,527 3,910 1.256 2,654 324 309 Total other income and expenses Interest Expense Income Before Income Taxes 1,916 3,734 1.156 2,578 ncome Tax Expense Net Income before nonrecurring items

Explanation / Answer

Ans. 1. Calculation of Financial leverage = EBIT/EBIT-Interest

*EBIT= Earning before Interest and tax

**EBT= Earning before tax

                                                                       year 31st Dec. 2016                  31st Dec. 2015

Earning before tax                                                    $3734                                         $3910

Earning before intt and tax (EBIT)                              $5650                                         $5437

                                                                        ($3734+$1916)                            ($3910+$1527)

Financial Leverage (EBIT/EBIT-Interest)        1.51    1.39

2. P/E Ratio = market price/ EPS

Market price $ 78.02    $77.62

EPS    $3.71 $3.80

p/e Ratio    21.03 times    $20.43 times

3. Calculation of percentage of retained earning

EPS $3.71 $3.80

Dividend per share                                                   $3.33 $3.37

   ($2332/700) ($2254/668)   

Percentage of Retained earning (eps-dps/eps) $10.24%    11.32%

4. Dividend per share $3.33     $3.37

5. Dividend payout (100-%of retained earning)    89.76% 88.68%               

                                                                         (100%-10.24%)                           (100%-11.32%)

6. Dividend yield= annual dividend/market price

Market price                                                          $78.02                                        $77.62

Dividend per share                                                 $3.33                                           $3.37

Dividend yield                                                        4.27%                                         4.34%

7. Book value per share (shareholder equity/total no share outstanding)

Shareholder equity                                                 $41041                                       $39771

no of share oustanding                                           700 Million                                  668 Million

Book value per share                                            $58.63                                         $59.54

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