Business Finance Homework Help

Answers must be in complete sentences and/or paragraphs. Yes, or No is not an acceptable answer. Also, please be sure to carefully cite your sources. It is not acceptable to cut and paste from the Annual report without attribution. Where it is necessary to quote brief citations, you should use quotation marks. You should always reference where you obtained the material, for example: General Motors, 2006 Annual Report page 63.

1. Calculate the current ratio for the past two years. Did the current ratio improve or weaken in the more recent year?

2. Calculate the acid-test (quick) ratio for the past two years. Did the acid-test ratio improve or weaken in the more recent year?

3. If the company purchased $50 million of inventory by debiting inventory and crediting accounts payable, how would its current ratio and acid-test ratio change? Show your calculations.

4. Calculate the debt to equity ratio for the past two years. Did the ratio improve or weaken in the more recent year?

5. Calculate the times interest earned ratio for the past two years. Did the ration improve or weaken in the most recent year?

6. Based on the calculations in questions 1 and 2 how would you rate the bankruptcy risk of the company?

Compute the ratios titled Profitability Analysis attached to these project guidelines for current year. Use the chart below. Show all work – plug in the numbers in the formula then compute the answer.

Measures of Profitability		Current Year
Gross Profit percentage	Gross Profit/Net Sales
Return on Sales	Net Income/Net Sales
Return on Assets	Net Income/Total Assets
Return on Equity	Net Income/Stockholders’ Equity

https://www.sec.gov/ix?doc=/Archives/edgar/data/10… WALMARTS 10-K ANNUAL REPORT!