Exhibit 5.26 presents risk ratios for Starbucks for 2006 and 2007. Exhibits 1.26, 1.27, and 1.28 in

Question:

Exhibit 5.26 presents risk ratios for Starbucks for 2006 and 2007. Exhibits 1.26, 1.27, and 1.28 in Chapter 1 present the financial statements for Starbucks.

Required

a. Compute the values of each of the ratios in Exhibit 5.26 for Starbucks for 2008. Starbucks had 735.5 million common shares outstanding at the end of 2008, and the market price per share was $14.17. For days accounts receivable, use only specialty revenues in your calculations, because accounts receivable are primarily related to licensing and food service operations, not the retail operations. Use cost of sales, including occupancy costs, in the numerator of the GMI in the Beneish earnings manipulation model.

b. Interpret the changes in Starbucks risk ratios during the three-year period, indicating areas of concern.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...