S9-15 Examine the following selected financial information for Best Buy Co., and
ID: 2557128 • Letter: S
Question
S9-15 Examine the following selected financial information for Best Buy Co., and Walmart Stores, Inc., as of the end of their fiscal years ending in 2015:1) complete the table, calculating all the requested information for the two companies. r 9 LO 4 S9-15. (Learning Objective 4: earned ratio, and evaluate aleulate the leverage ratio, debt ratio, and times-interest- debt-paying ability ) Examine the following selected financial information for Best Buy Co., Inc., and Walmart Stores, Inc., as of the end of their fiscaly ending in 2015: (In millions) 1. Total assets 2. Total Stockholders' equity 3. Operating income. Best Buy Co., Inc. Walmart Stores, Inc. $15,256 4,995 ....1,450 S 90 $203,706 s 81,394 $ 27,147 $ 2,348 5. Leverage ratio. 6. Total debt 7. Debt ratio. 8. Times interest earned 1. Complete the table, calculating all the requested information for the two companies. Use year-end figures in place of averages where needed for the purpose of calculating ratios in this exercise. 2. Evaluate each company's long-term debt-paying ability (strong, medium, weak).
Explanation / Answer
As we know Total assets= total debt+share holders equity
Debt= total assets-shareholders equity
Debt= 10261 and 122312
Leverage ratio is ratio of total debts to total equity
debt ratio is the ratio of total debt to total assets
Times interest earned is the ratio of Earnings before interest and tax to interst charges
A company's debt paying ability shows its SOLVENCY position that how much it can accommodate in terms of solvency.
debt ratio is the strong measuring for it where as equity ratio and times interest earned are the medium and weak measuring ratios respectively
debt 10261 122312 leverage ratio 205.4254 150.2715 debt ratio 67.25878 60.0434 times interest earned 16.11111 11.56175Related Questions
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