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$ millions Total assets Total liabilities Total equity Apple Current Year $ 338,516 248, 028 90, 488 Prior Year $365,725 258, 578 107, 147 Google Current Year $ 275,909 74,467 201,442 Prior Year $ 232,792 55,164 177, 628

$ millions Total assets Total liabilities Total equity Apple Current Year $ 338,516 248, 028 90, 488 Prior Year $365,725 258, 578 107, 147 Google Current Year $ 275,909 74,467 201,442 Prior Year $ 232,792 55,164 177, 628

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Key figures for Apple and Google follow. $ millions Current Year $ 338,516 248, 028 90, 488 Total assets Google Current Year $ 275,909 74, 467 Prior Year $365, 725 258, 578 Prior Year $ 232,792 55,164 Total liabilities Total equity 107, 147 201, 442 177, 628 Required: 1. Compute the debt-to-equity ratios for Apple and Google for both the current year and the prior year. 2. Use the ratios we computed in part 1 to determine which company's financing structure is less risky. 3. Is its debt-to-equity ratio more risky or less risky compared to the industry (assumed) average of 0.5 for (a) Apple and (b) Google? Apple
Transcribed Image Text:Key figures for Apple and Google follow. $ millions Current Year $ 338,516 248, 028 90, 488 Total assets Google Current Year $ 275,909 74, 467 Prior Year $365, 725 258, 578 Prior Year $ 232,792 55,164 Total liabilities Total equity 107, 147 201, 442 177, 628 Required: 1. Compute the debt-to-equity ratios for Apple and Google for both the current year and the prior year. 2. Use the ratios we computed in part 1 to determine which company's financing structure is less risky. 3. Is its debt-to-equity ratio more risky or less risky compared to the industry (assumed) average of 0.5 for (a) Apple and (b) Google? Apple
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