A spreadsheet containing financial statements for Nike, Inc., for fiscal years 2017–2020 is available for download from McGraw-Hill’s Connect or your course instructor (see the Preface for more information).

a. Use the spreadsheet to calculate as many of the company’s profitability, turnover-control, and leverage and liquidity ratios as you can for these years (see Table 2.4).

b. What do these ratios suggest about the company’s performance over this period?

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TABLE 2.4 Definitions of Principal Ratios Appearing in the Chapter Profitability Ratios Return on equity Return on assets Return on invested capital Profit margin Gross margin Price to earnings Turnover-Control Ratios Asset turnover Fixed-asset turnover Inventory turnover Collection period Days' sales in cash Payables period = Net income/Shareholders' equity = Net income/Assets = = = = = = |||| = = Earnings before interest and taxes x (1 - Tax rate) Interest-bearing debt + Shareholders' equity Net income/Sales Gross profit/Sales Price per share/Earnings per share Sales/Assets Sales/Net property, plant, and equipment Cost of goods sold/Ending inventory Accounts receivable/Credit sales per day (If credit sales unavailable, use sales) Cash and securities/Sales per day Accounts payable/Credit purchases per day (If purchases unavailable, use cost of goods sold)