Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN: 9781285190907
Author: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher: Cengage Learning
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Chapter 5, Problem 1AIC
Compute the values of each of the ratios in Exhibit 5.27 for Starbucks for 2012. Starbucks had 749.3 million common shares outstanding at the end of fiscal 2012, and the market price per share was $50.71. For days accounts receivable outstanding, use only specialty revenues in your calculations, because accounts receivable are primarily related to licensing and food service operations, not the retail operations.
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Review the select information for Bean Superstore and Legumes Plus (industry competitors), and then complete the following.
Compute the accounts receivable turnover ratios for each company for 2018 and 2019.
Compute the number of days’ sales in receivables ratios for each company for 2018 and 2019.
Determine which company is the better investment and why. Round answers to two decimal places.
10. Review the select information for Bean Superstore and
Legumes Plus (industry competitors), and then complete the
following.
A. Compute the accounts receivable turnover ratios for each
company
for 2018 and 2019.
B. Compute the number of days' sales in receivables ratios for
each company for 2018 and 2019.
C. Determine which company is the better investment and why.
Round answers to two decimal places.
BEAN SUPERSTORE
LEGUMES PLUS
Comparative Balance Sheet
December 31, 2017, 2018, and 2019
Comparative Balance Sheet
December 31, 2017, 2018, and 2019
2019
2018
2017
2019
2018
2017
Assets
Cash
$345,600
67,000
145,830
100,465
$330,460
62,000
178,011
101,202
$300,000
59,000
155,205
103,085
$407,000
85,430
128,080
182,006
$386,450
82,670
40,036
23,400
$356,367
79,230
52,142
111,701
Accounts Receivable
Inventory
Equipment
Total Assets
$658,895
$671,673
$617,290
$802,516
$532,556
$599,440
Liabilities
Salaries Payable
Accounts Payable
Notes Payable
$ 91,455
$ 90,200
70,000
41,000
$ 88,563…
10. Review the select information for Bean Superstore and Legumes Plus (industry
competitors), and then complete the following.
A. Compute the accounts receivable turnover ratios for each company for 2018 and 2019.
B Compute the number of days sales in receivables ratios for each company for 2018 and
2019
C. Determine which company is the better investment and why. Round answers to two
decimal places.
Chapter 5 Solutions
Financial Reporting, Financial Statement Analysis and Valuation
Ch. 5 - Prob. 1QECh. 5 - Prob. 2QECh. 5 - A firm has experienced an increasing current ratio...Ch. 5 - A firm has experienced a decrease in its current...Ch. 5 - Prob. 5QECh. 5 - A firm had the following values for the four debt...Ch. 5 - Prob. 7QECh. 5 - Prob. 8QECh. 5 - Prob. 9QECh. 5 - Prob. 10QE
Ch. 5 - Market equity beta measures the covariability of a...Ch. 5 - Altmans bankruptcy risk model utilizes the values...Ch. 5 - Calculating and Interpreting Risk Ratios. Refer to...Ch. 5 - Refer to the financial state-ment data for...Ch. 5 - Refer to the profitability ratios of Coca-Cola in...Ch. 5 - Delta Air Lines, Inc., is one of the largest...Ch. 5 - Prob. 17PCCh. 5 - Prob. 18PCCh. 5 - Prob. 19PCCh. 5 - Prob. 20PCCh. 5 - Prob. 21PCCh. 5 - Prob. 22PCCh. 5 - Compute the values of each of the ratios in...
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