Lowe's Companies Inc., a major competitor of The Home Depot in the home improvement business, operates over 1,800 stores. Lowe's recently reported the following balance sheet data (in millions) Year 2 Year 1 Total assets $31,827 $32,732 Total liabilities 20,879 21,859 a. Determine the total stockholders' equity at the end of Years 2 and 1. b. Determine the ratio of liabilities to stockholders' equity for Year 2 and Year 1. Round to two decimal places What conclusions regarding the risk to the creditors can you draw from (b)? C. d. Using the balance sheet data for The Home Depot in Exercise 1-26, how does the ratio of liabilities to stockholders' equity of Lowe's compare to that of The Home Depot?
Lowe's Companies Inc., a major competitor of The Home Depot in the home improvement business, operates over 1,800 stores. Lowe's recently reported the following balance sheet data (in millions) Year 2 Year 1 Total assets $31,827 $32,732 Total liabilities 20,879 21,859 a. Determine the total stockholders' equity at the end of Years 2 and 1. b. Determine the ratio of liabilities to stockholders' equity for Year 2 and Year 1. Round to two decimal places What conclusions regarding the risk to the creditors can you draw from (b)? C. d. Using the balance sheet data for The Home Depot in Exercise 1-26, how does the ratio of liabilities to stockholders' equity of Lowe's compare to that of The Home Depot?
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter1: Introduction To Accounting And Business
Section: Chapter Questions
Problem 27E
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