Papa John's Yum! Brands Total assets $495 $8,075 Total liebilities 444 7,164 Total stockholders' equity 51 911
The following total liabilities and
Yum! Brands is a much larger company than is Papa John's; however, both companies compete internationally in the fast food business. Papa John's is primarily in the carry-out and delivery pizza business, while Yum! Brands is in the quick-service restaurant business with its Pizza Hut, Taco Bell, and KFC brands.
a. Compute the ratio of liabilities to stockholders' equity for each company. Round to one dec imal place.
b. What conclusions regarding the margin of protection to creditors can you draw for these two companies?
c. Which company is more risky to creditors?
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