(a) Compute net operating profit after tax (NOPAT) for 2018. Assume that the combined federal and state statutory tax rate is 22%. $ NOPAT (b) Compute net operating assets (NOA) for 2018 and 2017. Year 2018 $ 2017 $ NOA 0 0 (c) Compute RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2018. Do not use NOPM x NOAT to calculate RNOA. Do not round until your final answer. Numerator Denominator 0 $ 0 RNOA % Numerator Denominator NOPM $ 0 $ 0 % Numerator Denominator 0 $ NOAT 0 (d) Compute net nonoperating obligations (NNO) for 2018 and 2017. Confirm the relation: NOA = NNO + Total equity. Year NNO 2018 $ 2017 $ 0 0 Year 2018 $ 2017 $ NNO Total equity NOA 0 $ 0 $ 0 0 0 0 (e) Compute return on equity (ROE) for 2018. Numerator Denominator $ 0 $ 0 ROE % (f) Infer the nonoperating return component of ROE for 2018. Use above answers to calculate. Nonoperating component of ROE 0% ROE RNOA 0% 0% The 2018 balance sheets and income statement for Netflix Inc. follow. Refer to these financial statements to answer the requirements. NETFLIX INC. Consolidated Statements of Earnings For Year Ended December 31, $ thousands 2018 Revenues Cost of revenues Marketing $15,953,439 9,967,538 2,528,567 Technology and development General and administrative 1,221,814 789,392 Operating income 1,446,128 Other income (expense) Interest expense (420,493) Interest and other income 200,823 Income before income taxes 1,226,458 Provision for income taxes 15,216 Net income $1,211,242 NETFLIX INC. Consolidated Balance Sheets in thousands, except par value Current assets Cash and cash equivalents 2018 2017 Current content assets, net Other current assets Total current assets Noncurrent content assets, net Property and equipment, net Other noncurrent assets Total assets Current liabilities Current content liabilities Accounts payable $3,953,581 $2,822,795 5,151,186 4,470,032 907,564 536,245 10,012,331 7,829,072 14,960,954 10,530,153 577,379 901,030 319,404 811,407 $26,451,694 $19,490,036 $4,686,019 $4,332,139 722,083 359,555 Accrued expenses 477,417 474,192 Deferred revenue 919,997 618,622 Total current liabilities 6,805,516 5,784,508 Noncurrent content liabilities 3,918,124 3,329,796 Long-term debt 10,360,058 6,499,432 Other noncurrent liabilities 129,231 135,246 Total liabilities Stockholders' equity Preferred stock, $0.001 par value Common stock, $0.001 par value Accumulated other comprehensive loss Retained earnings Total shareholders' equity Total liabilities and shareholders' equity Combined federal and state statutory tax rate 21,212,929 15,748,982 0 0 2,315,988 2,030,494 (19,582) (20,557) 2,942,359 1,731,117 5,238,765 3,741,054 $26,451,694 $19,490,036 22%

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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(a) Compute net operating profit after tax (NOPAT) for 2018. Assume that the combined federal and state statutory tax rate is 22%.
$
NOPAT
(b) Compute net operating assets (NOA) for 2018 and 2017.
Year
2018 $
2017 $
NOA
0
0
(c) Compute RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2018. Do not use NOPM x NOAT to calculate RNOA. Do not round until your final answer.
Numerator Denominator
0 $
0
RNOA
%
Numerator
Denominator
NOPM
$
0 $
0
%
Numerator Denominator
0 $
NOAT
0
(d) Compute net nonoperating obligations (NNO) for 2018 and 2017. Confirm the relation: NOA = NNO + Total equity.
Year NNO
2018 $
2017 $
0
0
Year
2018 $
2017 $
NNO
Total equity
NOA
0 $
0 $
0
0
0
0
(e) Compute return on equity (ROE) for 2018.
Numerator Denominator
$
0 $
0
ROE
%
(f) Infer the nonoperating return component of ROE for 2018. Use above answers to calculate.
Nonoperating component of ROE
0%
ROE
RNOA
0%
0%
Transcribed Image Text:(a) Compute net operating profit after tax (NOPAT) for 2018. Assume that the combined federal and state statutory tax rate is 22%. $ NOPAT (b) Compute net operating assets (NOA) for 2018 and 2017. Year 2018 $ 2017 $ NOA 0 0 (c) Compute RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2018. Do not use NOPM x NOAT to calculate RNOA. Do not round until your final answer. Numerator Denominator 0 $ 0 RNOA % Numerator Denominator NOPM $ 0 $ 0 % Numerator Denominator 0 $ NOAT 0 (d) Compute net nonoperating obligations (NNO) for 2018 and 2017. Confirm the relation: NOA = NNO + Total equity. Year NNO 2018 $ 2017 $ 0 0 Year 2018 $ 2017 $ NNO Total equity NOA 0 $ 0 $ 0 0 0 0 (e) Compute return on equity (ROE) for 2018. Numerator Denominator $ 0 $ 0 ROE % (f) Infer the nonoperating return component of ROE for 2018. Use above answers to calculate. Nonoperating component of ROE 0% ROE RNOA 0% 0%
The 2018 balance sheets and income statement for Netflix Inc. follow. Refer to these financial statements to answer the requirements.
NETFLIX INC. Consolidated Statements of Earnings
For Year Ended December 31, $ thousands
2018
Revenues
Cost of revenues
Marketing
$15,953,439
9,967,538
2,528,567
Technology and development
General and administrative
1,221,814
789,392
Operating income
1,446,128
Other income (expense)
Interest expense
(420,493)
Interest and other income
200,823
Income before income taxes
1,226,458
Provision for income taxes
15,216
Net income
$1,211,242
NETFLIX INC. Consolidated Balance Sheets
in thousands, except par value
Current assets
Cash and cash equivalents
2018
2017
Current content assets, net
Other current assets
Total current assets
Noncurrent content assets, net
Property and equipment, net
Other noncurrent assets
Total assets
Current liabilities
Current content liabilities
Accounts payable
$3,953,581 $2,822,795
5,151,186 4,470,032
907,564 536,245
10,012,331
7,829,072
14,960,954
10,530,153
577,379
901,030
319,404
811,407
$26,451,694 $19,490,036
$4,686,019 $4,332,139
722,083
359,555
Accrued expenses
477,417
474,192
Deferred revenue
919,997
618,622
Total current liabilities
6,805,516 5,784,508
Noncurrent content liabilities
3,918,124
3,329,796
Long-term debt
10,360,058
6,499,432
Other noncurrent liabilities
129,231
135,246
Total liabilities
Stockholders' equity
Preferred stock, $0.001 par value
Common stock, $0.001 par value
Accumulated other comprehensive loss
Retained earnings
Total shareholders' equity
Total liabilities and shareholders' equity
Combined federal and state statutory tax rate
21,212,929 15,748,982
0
0
2,315,988
2,030,494
(19,582) (20,557)
2,942,359 1,731,117
5,238,765 3,741,054
$26,451,694 $19,490,036
22%
Transcribed Image Text:The 2018 balance sheets and income statement for Netflix Inc. follow. Refer to these financial statements to answer the requirements. NETFLIX INC. Consolidated Statements of Earnings For Year Ended December 31, $ thousands 2018 Revenues Cost of revenues Marketing $15,953,439 9,967,538 2,528,567 Technology and development General and administrative 1,221,814 789,392 Operating income 1,446,128 Other income (expense) Interest expense (420,493) Interest and other income 200,823 Income before income taxes 1,226,458 Provision for income taxes 15,216 Net income $1,211,242 NETFLIX INC. Consolidated Balance Sheets in thousands, except par value Current assets Cash and cash equivalents 2018 2017 Current content assets, net Other current assets Total current assets Noncurrent content assets, net Property and equipment, net Other noncurrent assets Total assets Current liabilities Current content liabilities Accounts payable $3,953,581 $2,822,795 5,151,186 4,470,032 907,564 536,245 10,012,331 7,829,072 14,960,954 10,530,153 577,379 901,030 319,404 811,407 $26,451,694 $19,490,036 $4,686,019 $4,332,139 722,083 359,555 Accrued expenses 477,417 474,192 Deferred revenue 919,997 618,622 Total current liabilities 6,805,516 5,784,508 Noncurrent content liabilities 3,918,124 3,329,796 Long-term debt 10,360,058 6,499,432 Other noncurrent liabilities 129,231 135,246 Total liabilities Stockholders' equity Preferred stock, $0.001 par value Common stock, $0.001 par value Accumulated other comprehensive loss Retained earnings Total shareholders' equity Total liabilities and shareholders' equity Combined federal and state statutory tax rate 21,212,929 15,748,982 0 0 2,315,988 2,030,494 (19,582) (20,557) 2,942,359 1,731,117 5,238,765 3,741,054 $26,451,694 $19,490,036 22%
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