(a) For each company, compute the following ratios. Assume all sales were on credit. (Round current ratio to 2 decimal places e.g. 1.85 and free cash flow to O decimal places and all other answers to 1 decimal place, e.g. 1.8 or 1.8%.) (1) (2) (3) Ratio Current ratio Accounts receivable turnover Average collection period Target :1 times days Walmart :1 times days

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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selected hypothetical financial data of of Tatget and Walmart for 2022 are presented here (in millions).

Question 5 of 9
<
>
Net sales
Cost of goods sold
Selling and administrative expenses
Interest expense
Other income (expense)
Income tax expense
Net income
Current assets
Noncurrent assets
Total assets
Current liabilities
Long-term debt
Total stockholders' equity
Total liabilities and stockholders' equity
Total assets
Total stockholders' equity
Current liabilities
Total liabilities
Average net accounts receivable
Average inventory
Net cash provided by operating activities
Capital expenditures
Cash dividends paid
Walmart
Target
Corporation
Inc.
Income Statement Data for Year
$409,000
303,000
76,000
2,100
(400)
6,700
$65,900
45,000
15,100
650
(95)
1,300
$3,755
$20,800
Balance Sheet Data (End of Year)
$49,000
123,000
$16,000
25,700
$41,700
$11,000
17,300
13,400
$41,700
$172,000
$56,000
45,000
71,000
$172,000
Beginning-of-Year Balances
$163,000
$45,000
12,500
10,000
32,500
Other Data
$7,700
7,200
5,600
1,700
460
66,000
58,000
97,000
$3,800
33,600
26,200
11,500
3,900
Transcribed Image Text:Question 5 of 9 < > Net sales Cost of goods sold Selling and administrative expenses Interest expense Other income (expense) Income tax expense Net income Current assets Noncurrent assets Total assets Current liabilities Long-term debt Total stockholders' equity Total liabilities and stockholders' equity Total assets Total stockholders' equity Current liabilities Total liabilities Average net accounts receivable Average inventory Net cash provided by operating activities Capital expenditures Cash dividends paid Walmart Target Corporation Inc. Income Statement Data for Year $409,000 303,000 76,000 2,100 (400) 6,700 $65,900 45,000 15,100 650 (95) 1,300 $3,755 $20,800 Balance Sheet Data (End of Year) $49,000 123,000 $16,000 25,700 $41,700 $11,000 17,300 13,400 $41,700 $172,000 $56,000 45,000 71,000 $172,000 Beginning-of-Year Balances $163,000 $45,000 12,500 10,000 32,500 Other Data $7,700 7,200 5,600 1,700 460 66,000 58,000 97,000 $3,800 33,600 26,200 11,500 3,900
(a)
For each company, compute the following ratios. Assume all sales were on credit. (Round current ratio to 2 decimal places e.g. 1.85 and
free cash flow to O decimal places and all other answers to 1 decimal place, e.g. 1.8 or 1.8%.)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
Ratio
Current ratio
Accounts receivable turnover
Average collection period
Inventory turnover
Days in inventory
Profit margin
Asset turnover
Return on assets
Return on common stockholders' equity
Debt to assets ratio
Times interest earned
Free cash flow
69
Target
:1
times
days
times
days
%
times
%
%
%
times
SA
Walmart
:1
times
days
times
days
times
%
%
%
times
Transcribed Image Text:(a) For each company, compute the following ratios. Assume all sales were on credit. (Round current ratio to 2 decimal places e.g. 1.85 and free cash flow to O decimal places and all other answers to 1 decimal place, e.g. 1.8 or 1.8%.) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) Ratio Current ratio Accounts receivable turnover Average collection period Inventory turnover Days in inventory Profit margin Asset turnover Return on assets Return on common stockholders' equity Debt to assets ratio Times interest earned Free cash flow 69 Target :1 times days times days % times % % % times SA Walmart :1 times days times days times % % % times
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(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
Ratio
Current ratio
Accounts receivable turnover
Average collection period
Inventory turnover
Days in inventory
Profit margin
Asset turnover
Return on assets
Return on common stockholders'
equity
Debt to assets ratio
Times interest earned
Free cash flow
Target
1.45
8.6 times
FOOOOOOOO
:1
42.6
days
times
days
%
times
%
%
%
times
$
Walmart
0.86
:1
107.6 times
3.4 days
OOOOOOOOO
times
days
%
times
%
%
%
times
Transcribed Image Text:(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) Ratio Current ratio Accounts receivable turnover Average collection period Inventory turnover Days in inventory Profit margin Asset turnover Return on assets Return on common stockholders' equity Debt to assets ratio Times interest earned Free cash flow Target 1.45 8.6 times FOOOOOOOO :1 42.6 days times days % times % % % times $ Walmart 0.86 :1 107.6 times 3.4 days OOOOOOOOO times days % times % % % times
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