The following data were taken from Netflix, Inc.s 2016 annual report. All dollar amounts are in millions.

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The following data were taken from Netflix, Inc.’s 2016 annual report. All dollar amounts are in millions.

Fiscal Years Ending December 31, 2016 December 31, 2015 $13,587 $10,203 Total assets Total liabilities Stockholders' equ


Required
a. For each year, compute Netflix’s debt-to-assets ratio, return-on-assets ratio, and return-on-equity ratio. You will need to compute total liabilities.
b. Did the company’s level of financial risk increase or decrease from 2015 to 2016?
c. In which year did the company appear to manage its assets most efficiently?
d. Do the preceding ratios support the concept of financial leverage? Explain.

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Related Book For  book-img-for-question

Introductory Financial Accounting for Business

ISBN: 978-1260299441

1st edition

Authors: Thomas Edmonds, Christopher Edmonds

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