Selected balance sheet and income statement information for Humana Inc., a health and wellbeing company, follows. 2018
Question:
Selected balance sheet and income statement information for Humana Inc., a health and wellbeing company, follows.
2018 | 2017 | ||||||
---|---|---|---|---|---|---|---|
2018 | 2018 Net | 2018 | 2017 | Stockholders' | Stockholders' | ||
Company ($ millions) | Ticker | Revenue | income | Assets | Assets | Equity | Equity |
Humana Inc | HUM | $66,943 | $11,714 | $35,444 | $37,209 | $20,192 | $19,873 |
Compute the following 2018 ratios for Humana.
a. Return on equity (ROE)
Note: 1. Select the appropriate numerator and denominator used to compute ROE from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute ROE.
Numerator | Denominator | ROE | |
---|---|---|---|
AnswerAverage assetsAverage equityAverage NOANet incomeNOPATNOPBTRevenueTax expenseTax on operating profitTax shield | AnswerAverage assetsAverage equityAverage NOANet incomeNOPATNOPBTRevenueTax expenseTax on operating profitTax shield | ||
Answer | Answer |
b. Profit margin (PM)
Note: 1. Select the appropriate numerator and denominator used to compute PM from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute PM.
Numerator | Denominator | PM | |
---|---|---|---|
AnswerAverage assetsAverage equityAverage NOANet incomeNOPATNOPBTRevenueTax expenseTax on operating profitTax shield | AnswerAverage assetsAverage equityAverage NOANet incomeNOPATNOPBTRevenueTax expenseTax on operating profitTax shield | ||
Answer | Answer |
c. Financial leverage (FL)
Note: 1. Select the appropriate numerator and denominator used to compute FL from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute FL.
Numerator | Denominator | FL | |
---|---|---|---|
AnswerAverage assetsAverage equityAverage NOANet incomeNOPATNOPBTRevenueTax expenseTax on operating profitTax shield | AnswerAverage assetsAverage equityAverage NOANet incomeNOPATNOPBTRevenueTax expenseTax on operating profitTax shield | ||
Answer | Answer |
Financial Accounting an introduction to concepts, methods and uses
ISBN: 978-0324789003
13th Edition
Authors: Clyde P. Stickney, Roman L. Weil, Katherine Schipper, Jennifer Francis