
Google and Microsoft:
Google, Inc. and Microsoft Corporation design and distribute consumer and enterprise software, including overlaps in search, business productivity, and mobile operating systems. Google’s primary source of revenue is from advertising, while Microsoft’s is from software subscription and support fees. The following year-end data (in millions) were taken from recent
Microsoft | ||||
Year 2 | Year 1 | Year 2 | Year 1 | |
Current assets | $114,246 | $101,466 | $72,886 | $80,685 |
Current liabilities | 45,625 | 37,417 | 15,908 | 16,805 |
A. Compute the
B. Which company has the larger working capital at the end of Year 2?
C. Is working capital a good measure of relative liquidity in comparing the two companies? Explain.
D. Compute the current ratio for both companies. (Round to one decimal place.)
E. Which company has the larger relative liquidity based on the current ratio?
F. Based on your analysis, comment on the short-term debt-paying ability of these two companies.

Trending nowThis is a popular solution!

Chapter 4 Solutions
Financial & Managerial Accounting
Additional Business Textbook Solutions
Accounting Information Systems (14th Edition)
PRIN.OF CORPORATE FINANCE
Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
Principles of Operations Management: Sustainability and Supply Chain Management (10th Edition)
Financial Accounting, Student Value Edition (5th Edition)
Operations Management: Processes and Supply Chains (12th Edition) (What's New in Operations Management)
- The direct material price variance isarrow_forwardBradford Enterprises estimated manufacturing overhead for the year at $350,000. Manufacturing overhead for the year was underapplied by $15,000. The company applied $300,000 to Work in Process. The amount of actual overhead would have been_____.arrow_forwardWhat was its charge for depreciation and amortization of this financial accounting question?arrow_forward
- Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubSurvey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
- Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning



