Analysis of liquidity and profitability measures


Assignment:

Analysis of liquidity and profitability measures of Motorola, Inc. The following summarized data (amounts in millions) are taken from the December 31, 1999 and 1998 comparative financial statements of Motorola, Inc., a manufacturer of wireless communication devices, semiconductors, and advanced electronic systems.

(Amounts expressed in millions)                                                 1999               1998

For the Year Ended December 31:

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $30,931      $29,398

Manufacturing and other costs of sales . . . . . . . . . . . . . . . . . . . . . 19,169         18,043

Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,323           (1,158)

Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 817            $ (962)

At December 31:

Assets

Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,345                $ 1,453

Short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 699                         171

Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,125                       5,057

Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,422                     3,745

Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,162                     2,362

Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 750                         743

Property, plant, and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . 9,246                   10,049

Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,578                    5,148

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $37,327                  $28,728

Liabilities and Owners' Equity

Notes payable and current portion of long-term debt . . . . . . . . . . . $ 2,504         $ 2,909

Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,015                 2,305

Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,897              6,226

Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,089               2,633

Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,481             1,188

Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,997             1,245

Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,838                 1,804

Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,572                1,894

Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,780                 8,254

Non-owner changes to equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,154                 270

Total liabilities and stockholders' equity . . . . . . . . . . . . . . . . . . . . . $37,327          $28,728

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Accounting Basics: Analysis of liquidity and profitability measures
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