Business Finance Homework Help

The company I have chosen for this is AT&T

Overview: Debt Utilization Ratios

This week you evaluate the company’s debt utilization ratios. This category of ratios is especially important to creditors and investors.

If you wish to change companies, go to the discussion thread for Discussion 1 to reserve your new company making sure no one else has already reserved it. If you decide to stay with the same company you used for Discussion 1, there is no need to re-reserve it.

A tip as you start preparing this week’s discussion – the eStatement Studies database uses the term ‘Net Worth’ for the equity ratio, so as you collect data look for that value. There will be just one value rather than the three quartile breaks we have gotten used to seeing. The database also does not directly provide the debt ratio, but we can calculate it: Debt ratio = 100 – equity ratio.

Your task is to prepare a report with the required information provided below. Use the same heading names (in bold) before presenting the information as requested.

Report Headings

Name of Company and Ticker Symbol: Company name, ticker symbol

10-K Report: Paste the direct URL to the company’s most recent 10-K Report

Company Website: Paste the URL to the company’s website

Industry name and NAICS Code: Provide the name and NAICS code associated with the Industry Average data.

Debt Utilization Ratios: Follow the formatting in the example below to present the data. See this sample eStatement Studies document for help in finding the industry average data needed for this assignment.

	20XX	20XX	20XX	Industry Average*
Debt Ratio (Total Liabilities / Total Assets)	—	—	—	—-
Equity Ratio (Total Equity / Total Assets)	—	—	—	—-
Times Interest Earned (EBIT / Interest Exp)	—	—	—	—-
				—-
				—-

* There will be a single industry average for the debt and equity ratios. List all 3 industry average figures for the Time Interest Earned ratio.

Evaluation: Share what we learn from the data and information collected for this discussion. Interpret each of the ratios. Review the Financial Ratios Guidelines document for direction. Do you see any red flags? Does the company make greater use of debt financing or equity financing? Does the company have too much debt? How safely can the company cover its interest expense? How does this company compare to the industry averages? Sufficiently examining the data and information collected will likely require at least 250 words.