Short-Term Liquidity Ratios The financial statements for Puck Enterprises, a retailer, follow. Puck Enterprises Consolidated Income Statements (millions of dollars except per share data) December 31 2023 2022 2021 Revenues $19,233 $17,927 $16,115 Costs and expenses: Cost of retail sales, buying, and occupancy $14,164 $13,129 $11,751 Selling, publicity, and administration 3,175 2,978 2,801 Depreciation 498 459 410 Interest expense, net 446 437 398 Taxes other than income taxes 343 313 283 Total costs and expenses $18,626 $17,316 $15,643 Earnings before income taxes $607 $611 $472 Provision for income taxes 232 228 171 Net earnings $375 $383 $301 Puck Enterprises Consolidated Balance Sheets (millions of dollars) December 31, 2023 2022 ASSETS Current assets: Cash and cash equivalents $521 $117 Accounts receivable 1,536 1,514 Merchandise inventories 2,497 2,618 Other 267 165 Total current assets $4,821 $4,414 Property and equipment: Land $2,480 $998 Buildings and improvements 4,753 4,342 Fixtures and equipment 1,982 2,197 Construction-in-progress 248 223 Accumulated depreciation (2,336) (2,197) Net property and equipment $7,127 $5,563 Other 320 587 Total assets $12,268 $10,564 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable $200 $23 Accounts payable 1,654 1,347 Accrued liabilities 903 849 Income taxes payable 145 160 Current portion of long-term debt 173 371 Total current liabilities $3,075 $2,750 Long-term debt 4,279 4,771 Deferred income taxes and other 536 450 Loan to ESOP (217) (267) Total liabilities $7,673 $7,704 Stockholders' equity: Preferred stock 368 374 Common stock 72 71 Additional paid-in capital–common 73 58 Retained earnings 4,082 2,357 Total stockholders' equity $4,595 $2,860 Total liabilities and stockholders' equity $12,268 $10,564 Required: 1. Compute the four short-term liquidity ratios (rounded to two decimal places) for 2022 and 2023, assuming operating cash flows are $394 million and $501 million, respectively. Round your answers to two decimal places. 2023 2022 Current ratio fill in the blank 1 fill in the blank 2 Quick ratio fill in the blank 3 fill in the blank 4 Cash ratio fill in the blank 5 fill in the blank 6 Operating cash flow ratio fill in the blank 7 fill in the blank 8 2. Conceptual Connection: Indicate which ratio appears to be most appropriate for a retail organization.
Short-Term Liquidity Ratios The financial statements for Puck Enterprises, a retailer, follow. Puck Enterprises Consolidated Income Statements (millions of dollars except per share data) December 31 2023 2022 2021 Revenues $19,233 $17,927 $16,115 Costs and expenses: Cost of retail sales, buying, and occupancy $14,164 $13,129 $11,751 Selling, publicity, and administration 3,175 2,978 2,801 Depreciation 498 459 410 Interest expense, net 446 437 398 Taxes other than income taxes 343 313 283 Total costs and expenses $18,626 $17,316 $15,643 Earnings before income taxes $607 $611 $472 Provision for income taxes 232 228 171 Net earnings $375 $383 $301 Puck Enterprises Consolidated Balance Sheets (millions of dollars) December 31, 2023 2022 ASSETS Current assets: Cash and cash equivalents $521 $117 Accounts receivable 1,536 1,514 Merchandise inventories 2,497 2,618 Other 267 165 Total current assets $4,821 $4,414 Property and equipment: Land $2,480 $998 Buildings and improvements 4,753 4,342 Fixtures and equipment 1,982 2,197 Construction-in-progress 248 223 Accumulated depreciation (2,336) (2,197) Net property and equipment $7,127 $5,563 Other 320 587 Total assets $12,268 $10,564 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable $200 $23 Accounts payable 1,654 1,347 Accrued liabilities 903 849 Income taxes payable 145 160 Current portion of long-term debt 173 371 Total current liabilities $3,075 $2,750 Long-term debt 4,279 4,771 Deferred income taxes and other 536 450 Loan to ESOP (217) (267) Total liabilities $7,673 $7,704 Stockholders' equity: Preferred stock 368 374 Common stock 72 71 Additional paid-in capital–common 73 58 Retained earnings 4,082 2,357 Total stockholders' equity $4,595 $2,860 Total liabilities and stockholders' equity $12,268 $10,564 Required: 1. Compute the four short-term liquidity ratios (rounded to two decimal places) for 2022 and 2023, assuming operating cash flows are $394 million and $501 million, respectively. Round your answers to two decimal places. 2023 2022 Current ratio fill in the blank 1 fill in the blank 2 Quick ratio fill in the blank 3 fill in the blank 4 Cash ratio fill in the blank 5 fill in the blank 6 Operating cash flow ratio fill in the blank 7 fill in the blank 8 2. Conceptual Connection: Indicate which ratio appears to be most appropriate for a retail organization.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
-
Short-Term
Liquidity Ratios The financial statements for Puck Enterprises, a retailer, follow.
Puck Enterprises Consolidated Income Statements (millions of dollars except per share data) December 31 2023 2022 2021 Revenues $19,233 $17,927 $16,115 Costs and expenses: Cost of retail sales, buying, and occupancy $14,164 $13,129 $11,751 Selling, publicity, and administration 3,175 2,978 2,801 Depreciation 498 459 410 Interest expense, net 446 437 398 Taxes other than income taxes 343 313 283 Total costs and expenses $18,626 $17,316 $15,643 Earnings before income taxes $607 $611 $472 Provision for income taxes 232 228 171 Net earnings $375 $383 $301
Puck Enterprises Consolidated Balance Sheets (millions of dollars) December 31, 2023 2022 ASSETS Current assets: Cash and cash equivalents $521 $117 Accounts receivable 1,536 1,514 Merchandise inventories 2,497 2,618 Other 267 165 Total current assets $4,821 $4,414 Property and equipment: Land $2,480 $998 Buildings and improvements 4,753 4,342 Fixtures and equipment 1,982 2,197 Construction-in-progress 248 223 Accumulated depreciation (2,336) (2,197) Net property and equipment $7,127 $5,563 Other 320 587 Total assets $12,268 $10,564 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable $200 $23 Accounts payable 1,654 1,347 Accrued liabilities 903 849 Income taxes payable 145 160 Current portion of long-term debt 173 371 Total current liabilities $3,075 $2,750 Long-term debt 4,279 4,771 Deferred income taxes and other536 450 Loan to ESOP (217) (267) Total liabilities $7,673 $7,704 Stockholders' equity: Preferred stock 368 374 Common stock 72 71 Additional paid-in capital–common 73 58 Retained earnings 4,082 2,357 Total stockholders' equity $4,595 $2,860 Total liabilities and stockholders' equity $12,268 $10,564 Required:
1. Compute the four short-term liquidity ratios (rounded to two decimal places) for 2022 and 2023, assuming operating cash flows are $394 million and $501 million, respectively. Round your answers to two decimal places.
2023 2022 Current ratio fill in the blank 1 fill in the blank 2 Quick ratio fill in the blank 3 fill in the blank 4 Cash ratio fill in the blank 5 fill in the blank 6 Operating cash flow ratio fill in the blank 7 fill in the blank 8 2. Conceptual Connection: Indicate which ratio appears to be most appropriate for a retail organization.
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