Corporate Financial Accounting
15th Edition
ISBN: 9781337398169
Author: Carl Warren, Jeff Jones
Publisher: Cengage Learning
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Question
Chapter 14, Problem 14.7EX
a.
To determine
Financial Ratios: Financial ratios are the metrics used to evaluate the capabilities, profitability, and overall performance of a company.
To compute: Current and acid-test ratio for current year and previous year.
b.
To determine
Financial Ratios: Financial ratios are the metrics used to evaluate the capabilities, profitability, and overall performance of a company.
To provide: Conclusion towards company’s ratios
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Current Position Analysis
Sherwood, Inc., the parent company of Frito-Lay snack foods and Sherwood beverages, had the following current assets and current liabilities at the end of two recent years:
Current Year(in millions)
Previous Year(in millions)
Cash and cash equivalents
$3,599
$3,902
Short-term investments, at cost
2,556
7,247
Accounts and notes receivable, net
8,125
7,433
Inventories
2,142
2,142
Prepaid expenses and other current assets
714
792
Short-term obligations
286
3,032
Accounts payable
6,854
6,748
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
Current Position Analysis
Sherwood, Inc., the parent company of Frito-Lay snack foods and Sherwood beverages, had the following current assets and current liabilities at the end of two recent years:
Current Year(in millions)
Previous Year(in millions)
Cash and cash equivalents
$2,463
$2,610
Short-term investments, at cost
1,749
4,847
Accounts and notes receivable, net
5,560
4,971
Inventories
1,571
1,396
Prepaid expenses and other current assets
523
516
Short-term obligations
279
2,964
Accounts payable
6,701
6,596
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
Current Year
Previous Year
1. Current ratio
fill in the blank 1
fill in the blank 2
2. Quick ratio
fill in the blank 3
fill in the blank 4
Current Position Analysis
Sherwood, Inc., the parent company of Tasty snack foods and Super beverages, had the following current assets and current liabilities at the end of two recent years:
Current Year(in millions)
Previous Year(in millions)
Cash and cash equivalents
$3,315
$3,531
Short-term investments, at cost
2,355
6,557
Accounts and notes receivable, net
7,485
6,726
Inventories
1,973
1,753
Prepaid expenses and other current assets
658
649
Short-term obligations
351
3,723
Accounts payable
8,419
8,287
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
Current Year
Previous Year
1. Current ratio
fill in the blank 1
fill in the blank 2
2. Quick ratio
fill in the blank 3
fill in the blank 4
b. The liquidity of Sherwood has
some over this time period. Both the current and quick ratios have
. Sherwood is a
company with
resources for meeting short-term…
Chapter 14 Solutions
Corporate Financial Accounting
Ch. 14 - Briefly explain the difference between liquidity,...Ch. 14 - What is the advantage of using comparative...Ch. 14 - Prob. 3DQCh. 14 - How would the current and quick ratios of a...Ch. 14 - Prob. 5DQCh. 14 - What do the following data, taken from a...Ch. 14 - A. How does the rate earned on total assets differ...Ch. 14 - Kroger, a grocery store, recently had a...Ch. 14 - The dividend yield of Suburban Propane Partners,...Ch. 14 - Prob. 10DQ
Ch. 14 - Horizontal analysis The comparative accounts...Ch. 14 - Vertical analysis Income statement information for...Ch. 14 - Current position analysis The following items are...Ch. 14 - Accounts receivable analysis A company reports the...Ch. 14 - Inventory analysis A company reports the...Ch. 14 - Prob. 14.6BECh. 14 - To determine: Times interest earned ratio Given...Ch. 14 - Asset turnover A company reports the following:...Ch. 14 - Return on total assets A company reports the...Ch. 14 - Common stockholders profitability analysis A...Ch. 14 - Earnings per share and price-earnings ratio A...Ch. 14 - Vertical analysis of income statement Revenue and...Ch. 14 - a Current fiscal year income from continuing...Ch. 14 - Common-sized income statement Revenue and expense...Ch. 14 - Vertical analysis of balance sheet Balance shed...Ch. 14 - a. Net income increase, 78,0% Horizontal analysis...Ch. 14 - a. (1) Current year working capital. 1,090,000...Ch. 14 - Prob. 14.7EXCh. 14 - Current position analysis The bond indenture for...Ch. 14 - Accounts receivable analysis The following data...Ch. 14 - Accounts receivable analysis Xavier Stores Company...Ch. 14 - Inventory analysis The following data were...Ch. 14 - Inventory analysis QT, Inc. and Elppa Computers,...Ch. 14 - Ratio of liabilities to stockholders' equity and...Ch. 14 - Prob. 14.14EXCh. 14 - a. Mondelez International Inc., 1.4 Ratio of...Ch. 14 - a. YRC, 2.6 Asset turnover Three major segments of...Ch. 14 - Profitability ratios The following selected data...Ch. 14 - a. Year 3 return on total assets. 6.8%...Ch. 14 - Six measures of solvency or profitability The...Ch. 14 - Five measures of solvency or profitability The...Ch. 14 - Earnings per share, price-earnings ratio, dividend...Ch. 14 - a. Alphabet, 37.9 Price-earnings ratio; dividend...Ch. 14 - Earnings per share, discontinued operations The...Ch. 14 - Prob. 14.24EXCh. 14 - Unusual items Explain whether Colston Company...Ch. 14 - Comprehensive Income Anson Industries, Inc....Ch. 14 - Horizontal analysis of income statement For 20V2,...Ch. 14 - Prob. 14.2APRCh. 14 - Prob. 14.3APRCh. 14 - Measures of liquidity, solvency, and profitability...Ch. 14 - Solvency and profitability trend analysis Addai...Ch. 14 - Horizontal analysis of income statement For 20Y2,...Ch. 14 - Prob. 14.2BPRCh. 14 - Effect of transactions on current position...Ch. 14 - Measures of liquidity, solvency and profitability...Ch. 14 - Solvency and profitability trend analysis Crosby...Ch. 14 - Analyze and compare Amazon.com, Best Buy, and...Ch. 14 - Prob. 14.2MADCh. 14 - Analyze Deere Company Deere Company (DE)...Ch. 14 - Analyze and compare Marriott and Hyatt Marriott...Ch. 14 - Prob. 14.1TIFCh. 14 - Prob. 14.3TIF
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