Question

Suppose McDonald’s 2022 financial statements contain the following selected data (in millions). Current assets $3,446.0 Interest...

Suppose McDonald’s 2022 financial statements contain the following selected data (in millions). Current assets $3,446.0 Interest expense $479.0 Total assets 30,254.0 Income taxes 1,942.0 Current liabilities 3,013.0 Net income 4,557.0 Total liabilities 16,221.0 (a1) Compute the following values.

a. Working capital. (Round to 1 decimal place, e.g. 5,275.5) $enter a dollar amount in millions millions

b. Current ratio. (Round to 2 decimal places, e.g. 6.25:1.) enter current ratio rounded to 2 decimal places :1

c. Debt to assets ratio. (Round to 0 decimal places, e.g. 62%.) enter percentages rounded to 0 decimal places %

d. Times interest earned. (Round to 2 decimal places, e.g. 6.25.) enter times interest earned rounded to 2 decimal places times

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

a) Working Capital = current assets - current liabilities

Given Current assets $3,446.0

Current liabilities $3,013.0

Working Capital = $3,446.0 - $3,013.0

= $433.0

b) Current ratio = current assets / current liabilities

= $3,446.0 / $3,013.0

= 1.14:1

c) Debt to assets ratio = Total liabilities / Total assets

Given Total liabilities = $16,221.0

Total assets = $30,254.0

Debt to assets ratio = $16,221.0 / $30,254.0

= 54%

d) Times interest earned = (Net income + taxes) / Interest expense

Given Interest expense $479.0

Income taxes $1,942.0

Net income $4,557.0

Times interest earned = ($4,557.0 + $1,942.0) / $479.0

= $6,499.0 / $479.0

= 13.68

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Pharoah Company provides you with the following balance sheet information as of December 31, 2022. Current...
Pharoah Company provides you with the following balance sheet information as of December 31, 2022. Current assets $10,350 Current liabilities $10,800 Long-term assets 23,850 Long-term liabilities 12,600    Total assets $34,200 Stockholders’ equity 10,800    Total liabilities and stockholders’ equity $34,200 In addition, Pharoah reported net income for 2022 of $14,400, income tax expense of $2,880, and interest expense of $1,170. Compute the current ratio and working capital for Pharoah for 2022. (Round current ratio to 2 decimal places, e.g. 2.75. Enter...
Suppose the following data were taken from the 2017 and 2016 financial statements of American Eagle...
Suppose the following data were taken from the 2017 and 2016 financial statements of American Eagle Outfitters. (All numbers, including share data, are in thousands.) 2017 2016 Current assets $ 963,700 $931,250 Total assets 2,017,700 1,750,250 Current liabilities 419,000 372,500 Total liabilities 572,700 526,700 Net income 175,000 404,500 Net cash provided by operating activities 299,000 487,300 Capital expenditures 255,000 279,200 Dividends paid on common stock 88,000 120,200 Weighted-average shares outstanding 203,000 213,600 (a) Calculate the current ratio for each year....
Nordstrom, Inc. operates department stores in numerous states. Selected hypothetical financial statement data (in millions) for...
Nordstrom, Inc. operates department stores in numerous states. Selected hypothetical financial statement data (in millions) for 2022 are presented below. End of Year Beginning of Year Cash and cash equivalents $ 740 $ 77 Accounts receivable (net) 1,980 1,830 Inventory 900 910 Other current assets 310 443 Total current assets $3,930 $3,260 Total current liabilities $1,990 $1,630 For the year, net credit sales were $8,258 million, cost of goods sold was $5,328 million, and net cash provided by operating activities...
The comparative statements of Cullumber Company are presented here. CULLUMBER COMPANY Income Statements For the Years...
The comparative statements of Cullumber Company are presented here. CULLUMBER COMPANY Income Statements For the Years Ended December 31 2022 2021 Net sales $1,894,200 $1,755,700 Cost of goods sold 1,063,575 1,011,200 Gross profit 830,625 744,500 Selling and administrative expenses 505,200 484,200 Income from operations 325,425 260,300 Other expenses and losses    Interest expense 23,500 21,500 Income before income taxes 301,925 238,800 Income tax expense 93,065 74,500 Net income $ 208,860 $ 164,300 CULLUMBER COMPANY Balance Sheets December 31 Assets 2022 2021...
1. Using these data from the comparative balance sheet of Crane Company, perform horizontal analysis. (If...
1. Using these data from the comparative balance sheet of Crane Company, perform horizontal analysis. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 0 decimal places, e.g. 12%.) Increase or (Decrease) Dec. 31, 2022 Dec. 31, 2021 Amount Percentage Accounts receivable $ 489,060 $ 429,000 $enter a dollar amount enter percentages rounded to 0 decimal places % Inventory $ 731,250 $ 625,000 $enter a dollar amount enter...
Ivanhoe Company provides you with the following balance sheet information as of December 31, 2017. Current...
Ivanhoe Company provides you with the following balance sheet information as of December 31, 2017. Current assets $12,100 Current liabilities $13,700 Long-term assets 29,300 Long-term liabilities 12,900    Total assets $41,400 Stockholders’ equity 14,800    Total liabilities and stockholders’ equity $41,400 In addition, Ivanhoe reported net income for 2017 of $19,000, income tax expense of $3,400, and interest expense of $1,600. Compute the current ratio and working capital for Ivanhoe for 2017. (Round current ratio to 2 decimal places, e.g. 2.75. Enter...
Blossom Company reported the following selected information at March 31. 2022 Total current assets $189,800 Total...
Blossom Company reported the following selected information at March 31. 2022 Total current assets $189,800 Total assets 437,000 Total current liabilities 292,000 Total liabilities 349,600 Net cash provided by operating activities 60,000 Calculate the current ratio, the debt to assets ratio, and free cash flow for March 31, 2022. The company paid dividends of $10,000 and spent $24,000 on capital expenditures. (Round current ratio and debt to assets ratio to 2 decimal places, e.g. 15.25. If answer is negative enter...
Sheridan Company has $1,200,000 in assets and $1,200,000 in stockholders’ equity, with 42,200 shares outstanding the...
Sheridan Company has $1,200,000 in assets and $1,200,000 in stockholders’ equity, with 42,200 shares outstanding the entire year. It has a return on assets of 15%. During 2021, it had net income of $180,000. On January 1, 2022, it issued $375,000 in debt at 4% and immediately repurchased 21,100 shares for $375,000. Management expected that, had it not issued the debt, it would have had net income of $180,000 in 2022. Assume the company pays dividends on common stock equal...
Additional information: The net cash provided by operating activities for 2022 was $190,200. The cash used...
Additional information: The net cash provided by operating activities for 2022 was $190,200. The cash used for capital expenditures was $91,000. The cash used for dividends was $30,200. The weighted-average common shares outstanding during the year was 50,000. (a) Compute the following values and ratios for 2022. (We provide the results from 2021 for comparative purposes.) (Round Current Ratio and Earnings per share to 2 decimal places, e.g. 15.25 and Debt to assets ratio to 1 decimal place, e.g. 78.9%....
The comparative statements of Blossom Company are presented here. BLOSSOM COMPANY Income Statements For the Years...
The comparative statements of Blossom Company are presented here. BLOSSOM COMPANY Income Statements For the Years Ended December 31 2022 2021 Net sales $1,512,400 $1,400,000 Cost of goods sold 847,000 804,800 Gross profit 665,400 595,200 Selling and administrative expenses 400,000 383,200 Income from operations 265,400 212,000 Other expenses and losses Interest expense 17,600 16,000 Income before income taxes 247,800 196,000 Income tax expense 74,340 58,800 Net income $ 173,460 $ 137,200 BLOSSOM COMPANY Balance Sheets December 31 Assets 2022 2021...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT