How Does Nike Define Cash Equivalents?

Cash Equivalents are balance sheet items that are typically reported using currency printed on notes.

What are NIKE’s cash equivalents?

NIKE’s cash and equivalents last quarter was $8.574 billion. NIKE’s cash and equivalents for fiscal years ending May 2018 to 2022 averaged $7.105 billion. NIKE’s operated at median cash and equivalents of $8.348 billion from fiscal years ending May 2018 to 2022.

How does the company define cash equivalents?

Cash and cash equivalents refers to the line item on the balance sheet that reports the value of a company’s assets that are cash or can be converted into cash immediately. Cash equivalents include bank accounts and marketable securities such as commercial paper and short-term government bonds.

What method does NIKE use to present cash from or to operating activities?

Nike uses FIFO. Nike reports property, plant, and equipment on its balance sheet and discloses the amount of depreciation for each year in its statement of cash flows.

How do you figure out cash equivalents?

These cash equivalents are included in the calculation of numerous measures of liquidity: Cash Ratio = Cash / Current Liabilities. Current Ratio = Current Assets / Current Liabilities. Quick Ratio = (Cash & Equivalents + A/R) / Current Liabilities.

Where does most of NIKE’s cash come from?

footwear
Most of Nike’s sales are generated by selling footwear to wholesale customers in North America.

How much does NIKE have in cash?

NIKE cash on hand for 2022 was $12.997B, a 3.55% decline from 2021. NIKE cash on hand for 2021 was $13.476B, a 53.36% increase from 2020. NIKE cash on hand for 2020 was $8.787B, a 88.44% increase from 2019.

Which of the following would be considered a cash equivalent?

Cash equivalents are any short-term investment securities with maturity periods of 90 days or less. They include bank certificates of deposit, banker’s acceptances, Treasury bills, commercial paper, and other money market instruments.

What do you mean by cash and cash equivalents give example?

Cash and cash equivalents is a line item on the balance sheet, stating the amount of all cash or other assets that are readily convertible into cash. Any items falling within this definition are classified within the current assets category in the balance sheet.

How does US GAAP define a cash equivalent?

U.S. GAAP defines cash equivalents as “short-term, highly liquid investments that are readily convertible to known amounts of cash and that are so near their maturity that they present insignificant risk of changes in value because of changes in interest rates” and includes a money market fund as an example of a cash

How does NIKE recognize revenue?

Certain prior year amounts have been reclassified to conform to fiscal 2016 presentation. Wholesale revenues are recognized when title and the risks and rewards of ownership have passed to the customer, based on the terms of sale.

How does NIKE manage its finances?

Nike shows the ability to generate revenue at healthy rates while keeping debt to a minimum and maximizing shareholder wealth. They pay their shareholders well through a Stable Dividend Policy as well as reinvesting capital back towards the company to expand its assets.

What is NIKE’s cash flow?

NIKE annual cash flow from operating activities for 2022 was $5.188B, a 22.07% decline from 2021. NIKE annual cash flow from operating activities for 2021 was $6.657B, a 167.89% increase from 2020. NIKE annual cash flow from operating activities for 2020 was $2.485B, a 57.9% decline from 2019.

Which of the following would not be considered a cash equivalent?

Cash equivalents are generally defined as investments that mature within three months from the date of purchase, such as money market funds, treasury bills, and certificates of deposit. Since the CD doesn’t mature until 1 year from now, it would NOT be considered a cash equivalent.

What is Nike’s biggest expense?

Nike’s greatest expense category is sales costs (mostly inventory and warehousing), which total more than $21 billion per year. What is this? Additionally, around $3 billion is allocated to marketing, including advertising and promotion, sponsorship, media, brand events, and retail brand presentation.

What makes Nike different from its competitors?

What makes Nike unique? Core associations for Nike include: innovative technology, high quality/stylish products, joy and celebration of sports, maximum performance, self-empowerment and inspiring, locally and regionally involved, and globally responsible.

What is Nike’s business strategy?

The Nike business strategy is clear, invest in building your brand through emotional marketing and sports celebrity endorsements, develop products that have high-quality, market-leading technology and buy out competing sports brands.

What is NIKE’s largest liability?

NIKE total liabilities for 2021 were $24.973B, a 7.24% increase from 2020. NIKE total liabilities for 2020 were $23.287B, a 58.66% increase from 2019.
Compare NKE With Other Stocks.

What is NIKE Total equity?

NIKE total liabilities and share holders equity for 2022 was $40.321B, a 6.84% increase from 2021. NIKE total liabilities and share holders equity for 2021 was $37.74B, a 20.41% increase from 2020. NIKE total liabilities and share holders equity for 2020 was $31.342B, a 32.15% increase from 2019.

What is NIKE’s largest current liabilities?

NIKE total current liabilities for 2022 were $10.73B, a 10.92% increase from 2021. NIKE total current liabilities for 2021 were $9.674B, a 16.78% increase from 2020. NIKE total current liabilities for 2020 were $8.284B, a 5.31% increase from 2019.

Which of the following should be excluded from cash and cash equivalents?

3. Which item should be excluded from cash and cash equivalents? avoid service charges.