a. Compute the current ratio and quick ratio for 2018 and 2019. Comment on any observed trends.

b. Compute total liabilitiestoequity ratio and total debttoequity ratio for 2018 and 2019. Comment on any trends observed.

c. Compute times interest earned ratio, cash from operations to total debt ratio, and free operating cash flow to total debt ratio for 2018 and 2019. Financial statements included the following footnote: Included in Interest expense (income), net was interest income related to the Companys investment portfolio of $82 million and $70 million for the years ended May 31, 2019 and 2018, respectively. Comment on any trends observed.

d. Summarize findings in a conclusion about the companys credit risk. Are there any concerns about the companys ability to meet its debt obligations?

NIKE, INC. Consolidated Statements of Income Year Ended May 31 (in millions) Revenues. Cost of sales. Gross profit. Demand creation expense Operating overhead expense. Total selling and administrative expense Interest expense (income), net. 20192018 Other (income) expense, net Income before income taxes Income tax expense. Net income NIKE, INC. Consolidated Balance Sheets May 31 (in millions) 20192018 Assets Current assets Cash and equivalents Short-term investments. Accounts receivable, net. Inventories . Prepaid expenses and other current assets . Total current assets. Property, plant, and equipment, net . Identifiable intangible assets, net . Goodwill . Deferred income taxes Total assets. Liabilities and shareholders' equity Current liabilities Current portion of long-term debt . Notes payable. Accounts payable. Accrued liabilities Income taxes payable. Total current liabilities. Long-term debt . Deferred income taxes and other liabilities. \begin{tabular}{rrr} $39,117 & & $36,397 \\ 21,643 & & 20,441 \\ 17,474 & & 15,956 \\ \hline 3,753 & & 3,577 \end{tabular} Shareholders' equity Class A convertible-315 and 329 shares outstanding. Class B-1,253 and 1,272 shares outstanding. \begin{tabular}{rrr} 8,949 & & 7,934 \\ 12,702 & & 11,511 \\ \hline 49 & \end{tabular} \begin{tabular}{rrr} (78) & & 66 \\ \cline { 3 - 3 } 4,801 & & 4,325 \\ 772 & & 2,392 \\ \hline$4,029 & & $1,933 \\ \hline \hline \end{tabular} Capital in excess of stated value . Accumulated other comprehensive income (loss) Retained earnings. Total shareholders' equity Total liabilities and shareholders' equity NIKE, INC. Consolidated Statements of Cash Flows Year Ended May 31 (in millions) 2019 Cash provided by operations: Net income...................................................... $4,029$1,933 Adjustments to reconcile net income to net cash provided by operations: Depreciation . Deferred income taxes Stock-based compensation. Amortization and other... Net foreign currency adjustments . Changes in certain working capital components and other assets and liabilities: (Increase) decrease in accounts receivable. (Increase) decrease in inventories (490) (Increase) decrease in prepaid expenses and other current and non-current assets. Increase (decrease) in accounts payable, accrued liabilities and other current and non-current liabilities . Cash provided by operations Cash provided (used) by investing activities: Purchases of short-term investments . Maturities of short-term investments. Sales of short-term investments . Additions to property, plant and equipment Disposals of property, plant and equipment . pg. 443 Other investing activities. Cash provided (used) by investing activities Cash used by financing activities: Long-term debt payments, including current portion. Increase (decrease) in notes payable. Payments on capital lease and other financing obligations Proceeds from exercise of stock options and other stock issuances . \begin{tabular}{ll} 5,9031,525 & 4,9551,515 \\ \hline \end{tabular} Tax payments for net share settlement of equity awards Cash used by financing activities Effect of exchange rate changes on cash and equivalents Net increase (decrease) in cash and equivalents. (2,937)1,7152,072(4,783)3,6132,496 Cash and equivalents, beginning of year . Cash and equivalents, end of year