Use the following information for P4—17 and P4—18:
The Hershey Company is one of the world’s leading producers of chocolates, candies, and confections. It sells chocolates and candies, mints and gums, baking ingredients, toppings, and beverages. Hershey’s consolidated balance sheets for 20X2 and 20X3 follow.
Ratios Analysis: Hershey Refer to the information for Hershey On the preceding page. Additional information for 20X3 is as follows (amounts in millions):
Required:
Next Level Compute the following ratios for 20X3. Provide a brief description of what each ratio reveals about Hershey.
Requirement 1:
Determine the return on common equity ratio of Company H for 20X3.
Determine the return on common equity ratio of Company H for 20X3:
Step 1: Calculate the average total common stockholders’ equity.
Requirement 2:
Determine the debt-to-assets ratio of Company H for 20X3.
Requirement 3:
Determine the debt-to-equity ratio of Company H for 20X3.
Requirement 4:
Determine the current ratio of Company H for 20X3.
Requirement 5:
Determine the quick ratio of Company H for 20X3.
Requirement 6:
Determine the inventory turnover in days of Company H for 20X3.
Requirement 7:
Determine the accounts receivable turnover in days of Company H for 20X3.
Requirement 8:
Determine the accounts payable turnover in days of Company H for 20X3.
Requirement 9:
Determine the operating cycle in days of Company H for 20X3.
Requirement 10:
Determine the total assets turnover ratio of Company H for 20X3.
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