Balance sheet 3/31/2016 12/31/2015 9/30/2015 6/30/2015 Assets Current Assets Cas

Question

Balance sheet 3/31/2016 12/31/2015 9/30/2015 6/30/2015 Assets Current Assets Cash and cash equivalents 293 300 255 232 Net receivables 401 362 385 460 Inventory 374 342 437 306 Other current assets 60 43 53 45 Total Current Assets 1,128 1,047 1,130 1,043 Long-term investments 128 97 -- 200 Property, plantm and equipment 979 991 995 1052 Goodwill 744 748 736 742 Other Assets 777 825 911 797 Total Assets 3756 3708 3772 3834 Liabilities Current Liabilites Accounts payable 876 1467 922 980 Short/current long-term debt 410 2 173 288 Other current liabilities -- -- -- -- Total Current liabilities 1,286 1469 1095 1268 Long-term debt 2381 2,124 474 475 Other liabilities 435 574 559 551 Total Liabilities 4102 4167 2128 2294 Total Shareholder's Equity -346 -459 1644 1540 Total Liabilities and Shareholder's Equity 3756 3708 3772 3834 Some balance sheet information is shown here EEB (all values in millions of dollars) a. What change in the book value of the company's equity took place at the end of 2015? b. Is the company's market-to-book ratio meaningful? Is its book debt-equity ratio meaningful? Explain. c. Find the company's other financial statements from that time online. What was the cause of the change to its book value of equity at the end of 2015? d. Does the company's book value of equity in 2016 imply that it is unprofitable? Explain. a. What change in the book value of the company's equity took place at the end of 2015? The book value of equity by bilin fom he end of the previous year, and was decimal places.) 1. (Select from the drop-down menus and round to three increased/decreased positive negative

Explanation / Answer

Amount in $ Book value of equity at the end of 30/6/2015 = 1540 Where as Book value of equity at the end of 31/3/16 = -346 It can be seen from above a huge difference in equity , Book value of equity has a drastic change resulting in a negative figure. We can conclude that, The book value of equity decreases by $1886 from the end of previous yeat and results in negative. The company equity has been reduced by $ 1886

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