The values for 2015 and 2016 with the zeros next to them are what I need to find
ID: 2788559 • Letter: T
Question
The values for 2015 and 2016 with the zeros next to them are what I need to find. A classmate got all but the last value correct. But I don't know how to find those values starting with degree of financial leverage through book value per share.
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions 12 Months Ended Dec. 31, 2016 Dec. 31, 2015 OPERATING REVENUES $ 16,155 $ 17,486 OPERATING EXPENSES (INCOME) Fuel, purchased power and interchange 4,042 5,327 Other operations and maintenance 3,389 3,269 Merger-related 135 26 Depreciation and amortization 3,077 2,831 Losses (gains) on disposal of assets - net (446) 4 Taxes other than income taxes and other - net 1,350 1,397 Total operating expenses - net 11,547 12,854 OPERATING INCOME 4,608 4,632 OTHER INCOME (DEDUCTIONS) Interest expense (1,093) (1,211) Benefits associated with differential membership interests - net 309 216 Equity in earnings of equity method investees 148 107 Allowance for equity funds used during construction 86 70 Interest income 82 86 Gains on disposal of investments and other property - net 40 90 Gain associated with Maine fossil 0 0 Other than temporary impairment losses on securities held in nuclear decommissioning funds (23) (40) Revaluation of contingent consideration 189 0 Other - net 42 40 Total other deductions - net (220) (642) INCOME (LOSS) BEFORE INCOME TAXES 4,388 3,990 INCOME TAXES 1,383 1,228 Net Income before nonrecurring Items 3,005 2,762 LESS NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS 93 10 Net income attributable to parent $ 2,912 $ 2,752 Earnings per share attributable to NEE: Basic EPS - Continuing operations $ 6.29 $ 6.11 Earnings per share attributable to NEE - assuming dilution: Stock Price December 31, 2016 Close Stock Price December 31, 2015 Close Diluted EPS - Continuing operations $ 6.25 $ 6.06 116.95 103.89 Dividends on common stock (246) (143) Weighted-average number of common shares outstanding: Shares are listed at the actual amounts not in millions 465800000 454000000 CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions Dec. 31, 2016 Dec. 31, 2015 CURRENT ASSETS Cash and cash equivalents 1,292 571 Customer receivables, net of allowances 1,784 1,784 Other receivables 655 481 Materials, supplies and fossil fuel inventory 1,289 1,259 Regulatory assets 524 503 Derivatives 885 712 Assets held for sale 452 1,009 Other 528 476 Total current assets 7,409 6,795 PROPERTY, PLANT AND EQUIPMENT Electric plant in service and other property $ 80,150 $ 72,606 Nuclear fuel 2,131 2,067 Construction work in progress 4,732 5,657 Accumulated depreciation and amortization (20,101) (18,944) Total property, plant and equipment - net 66,912 61,386 OTHER ASSETS Special use funds 5,434 5,138 Other investments ($479 related to a VIE at December 31, 2016) 2,482 1,786 Prepaid benefit costs 1,177 1,155 Regulatory assets ($107 and $128 related to a VIE, respectively) 1,894 1,778 Derivatives 1,350 1,202 Other 3,335 3,239 Total other assets 15,672 14,298 TOTAL ASSETS 89,993 82,479 CURRENT LIABILITIES Commercial paper 268 374 Other short-term debt 150 412 Current maturities of long-term debt 2,604 2,220 Accounts payable 3,447 2,529 Customer deposits 470 473 Accrued interest and taxes 480 449 Derivatives 404 882 Accrued construction-related expenditures 1,120 921 Regulatory liabilities 299 14 Liabilities associated with assets held for sale 451 992 Other 1,226 841 Total current liabilities 10,919 10,107 OTHER LIABILITIES AND DEFERRED CREDITS Asset retirement obligations 2,736 2,469 Deferred income taxes 11,101 9,827 Regulatory liabilities 4,906 4,606 Derivatives 477 530 Deferral related to differential membership interests - VIEs 4,656 3,142 Other 2,049 2,005 Total other liabilities and deferred credits 25,925 22,579 CAPITALIZATION Common stock 5 5 Additional paid-in capital 8,948 8,596 Retained earnings 15,458 14,140 Accumulated other comprehensive loss (70) (167) Total shareholders' equity 24,341 22,574 Noncontrolling interests 990 538 Total equity 25,331 23,112 Long-term debt 27,818 26,681 Total capitalization 53,149 49,793 COMMITMENTS AND CONTINGENCIES TOTAL CAPITALIZATION AND LIABILITIES 89,993 82,479 2016 2015 Degree of Financial Leverage 1.25 1.30 Exhibit 9-2 0 0 Price/Earnings 18.71 17.14 Exhibit 9-4 0 0 Percentage of Retained Earnings 92% 95% Exhibit 9-5 0 0 Dividend Per Share $ 0.53 $ 0.31 *Note 0 0 Dividend Payout 8.45% 5.20% Exhibit 9-6 0 0 Divended Yield 0.45% 0.30% Exhibit 9-7 0 0 Book Value Per Share $ 54.38 $ 50.91 Exhibit 9-8 0 0 * -Dividend Paid Times 1000000/Outstanding SharesExplanation / Answer
Degree of Financial Leverage = EBIT/EBT
Here, EBIT needs to be calculated from Bottom up approach i.e. Earning before tax + Interest expense
Hence,
Price/Earning Ratio = Market Price of Share/Earning Per share
Percentage of Retained Earnings = Retained Earnings/Net Income
Dividend per share = Dividend/NO. of shares outstanding
Dividend Payout = Dividend on common stock/ Net Income
Dividend Yield = Dividend per share/Market Price per share
Book Value per share = Total Equity/No. of shares outstanding
2016 2015 EBIT =4,388 + 1,093 = 5,481 =3,990 + 1,211 = 5,201 EBT 4,388 3,990 Degree of Financial Leverage 5481/4,388 5,201/3,990 Degree of Financial Leverage 1.25 1.30Related Questions
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