Current Prior Gather info for Proctor & Gamble in 2016 for below. Please Help Cu
ID: 2418421 • Letter: C
Question
Current
Prior
Gather info for Proctor & Gamble in 2016 for below. Please HelpCurrent
Prior
# QUESTIONS Year Year 67 Total cash received from the issuance of new debt 67 Total cash paid to retire debt 66 Total amount due to all creditors Current NonCurrent 66 Short-term debt 66 The amount the company must pay to retire ALL of its NOTES & DEBENTURES Amount of long-term debt due each of the next five years yr 1 yr 2 90 yr 3 yr 4 yr 5 67 Total interest paid 90 Amount of interest costs expensed 90 Amount of interest costs capitalized Compute the following ratios current ratio 70 acid-test ratio 72 cash debt coverage accts receivable turnover inventory turnover Comment on the company's liquidity 107 Fair value of all of the company's notes & debentures at the end of the current year? Why might a difference exist between the book value and fair value of debts (notes/debentures)? Estimate the company's "cash" interest rate for the current year interest paid/ beg notes Forecast the company's cash interest payment for the upcoming year on long-term 0.0% - Estimate the total amount of cash the company will pay in principal and interest on long-term - Compute the following ratios debt/total assets - - times interest ernd debt/equity - - Comment on the company's solvency and financial flexibility. Prepare a journal entry to record the purchase and retirement of the company’s long-term debt at the end of the current year at 101% of its book value. N/P - LOSS - CASH - 109 Does the company own any derivative securities or engage in hedging transactions? Describe Does the company have any loss or gain contingencies outstanding? Describe 106Explanation / Answer
67. Total cash received from the issuance of new Debt is $ 1502 million
67 Total cash paid to retire debt is $ 1496 million
66. Total amountdue to all creditors is $ 31,526 million
Current -- $ 13931 mllion
Non - current $ 17,595 million
66. Short term debt in Notes payable -- NIl
66. The amount the company must pay to retire all of its Notes and debentures is $ 17,595 million
66. Amount of long term detb due each of the next five years
67. Total ingterest paid
90. Amount of interest cost expensed is $ 143 million
90. Amount of interest cost capitalized is
90. Computation of ratios
(a) Current ratio = Current assets /current liabilities = 36,347/32053 = 1.13
(b) Acid test ratio = Quick assets /Quick liabilities = 0.81 (collected from P & G site)
(c) Cash debt coverage ratio = Cash from operations / total liabilities = 8018/67515 =0.11
(d) Accounts Receivables turnover ratio = Credit sales / average receivables = 14.14
(e) Inventorty turnover ratio = Cost of goods sold / average inventroy = 6.33
Comment : Company liquidity position can be evaluated on the basis of current ratio, quick ratio and cash ratio. these ratios are 1, 0.81 and 0.11 respectively but the bench mark current ratio and quick ratio is 2 and 1 respectively. Hence, the company's ratios are poor when compared to bench mark ratios.
107. Fair value of all the company's notes and debentures at the end of the current year will be $ 17,595 million. The difference between book value and fair value happen because of market value of debt that may either increase or decrease due to fluctions
CALCULATION OF RATIOS :
1. DEBT / TOTAL ASSETS = 17595/129143 = 0.13
2. DEBT / EQUITY = 17595/61628 = 0.28
Comment on solvency : Company's solvency is good as debt to total is only 0.13 and debt to total equity is 0.28, but still the company can improve the debt to get the advantages of debt i.e leverage advantages.
Journal Entry :
Dr. Long term debt a/c $ 17595
Dr. Loss on redempiton a/c $ 176
Cr Cash a/c $ 17771
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.