Chapter 1, Problem 74.3C

To determine

Concept Introduction:

Annual report:

The annual report of the company includes the financial and other operating descriptions about the business for a particular year.

Financial statements: Financial statements are prepared to summaries the account at the end of the period. The statements prepared are Income statement, Balance sheet, Statement of owner’s equity and Cash flows statements.

Requirement-a:

To Indicate:

The amount of Assets, Liabilities and Stockholder’s equity of Under Armour Inc. and Columbia Sportswear for the year ended Dec. 31, 2016.

Answer to Problem 74.3C

The amount of Assets, Liabilities and Stockholder’s equity of Under Armour Inc. and Columbia Sportswear for the year ended Dec. 31, 2016 are as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
$ in Thousands
Assets	3,644,331	2,013,894
Liabilities	1,613,431	432,383
Equity	2,030,900	1,581,511

Explanation of Solution

The amount of Assets, Liabilities and Stockholder’s equity of Under Armour Inc. and Columbia Sportswear for the year ended Dec. 31, 2016 can be found from the Consolidated balance Sheet as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
$ in Thousands
Assets	3,644,331	2,013,894
Liabilities	1,613,431	432,383
Equity	2,030,900	1,581,511

To determine

Concept Introduction:

Annual report:

The annual report of the company includes the financial and other operating descriptions about the business for a particular year.

Financial statements: Financial statements are prepared to summaries the account at the end of the period. The statements prepared are Income statement, Balance sheet, Statement of owner’s equity and Cash flows statements.

Requirement-b:

To Indicate:

The amount of Current Assets and Current Liabilities of Under Armour Inc. and Columbia Sportswear for the year ended Dec. 31, 2016.

Answer to Problem 74.3C

The amounts of Current Assets and Current Liabilities of Under Armour Inc. and Columbia Sportswear for the year ended Dec. 31, 2016 are as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
$ in Thousands
Current Assets	1,965,153	1,412,023
Current Liabilities	685,816	362,851

Explanation of Solution

The amount of Current Assets and Current Liabilities of Under Armour Inc. and Columbia Sportswear for the year ended Dec. 31, 2016 can be found from the Consolidated balance Sheet as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
$ in Thousands
Current Assets	1,965,153	1,412,023
Current Liabilities	685,816	362,851

To determine

Concept Introduction:

Annual report:

The annual report of the company includes the financial and other operating descriptions about the business for a particular year.

Financial statements: Financial statements are prepared to summaries the account at the end of the period. The statements prepared are Income statement, Balance sheet, Statement of owner’s equity and Cash flows statements.

Requirement-c:

To Indicate:

The liquidity of each company.

Answer to Problem 74.3C

The liquidity of each company is as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
Current Ratio	2.87	3.89

Hence, Columbia Sportswear is more liquid.

Explanation of Solution

The liquidity of each company is assessed using the current ratio as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
$ in Thousands
Current Assets (A)	1,965,153	1,412,023
Current Liabilities (B)	685,816	362,851
Current Ratio (A/B)	2.87	3.89

Hence, Columbia Sportswear is more liquid.

To determine

Concept Introduction:

Annual report:

The annual report of the company includes the financial and other operating descriptions about the business for a particular year.

Financial statements: Financial statements are prepared to summaries the account at the end of the period. The statements prepared are Income statement, Balance sheet, Statement of owner’s equity and Cash flows statements.

Requirement-d:

To Indicate:

The similarity between the companies.

Answer to Problem 74.3C

Both the companies have similar business and cash flow patterns.

Explanation of Solution

The liquidity of each company is assessed using the current ratio as follows:

Year 2016	Under Armour Inc.	Columbia Sportswear
$ in Thousands
Current Assets (A)	1,965,153	1,412,023
Current Liabilities (B)	685,816	362,851
Current Ratio (A/B)	2.87	3.89

Both the companies have similar business and cash flow patterns but Columbia Sportswear is more liquid.