Exhibit contains the income statements and balance sheets of The Hershey Company for the years ended December 31, 2011, and December 31, 2010. Hershey manufactures and sells products under more than 80 brand names.

1. Compute the following ratios for 2011: (a) total-debt-to-total-assets, and (b) total-debt-to-total-equity. To be consistent with the source of industry data used in the problem, define total debt as short-term debt and long-term debt (including the current portion) only. This definition is not the one we have used in the text, so it is worth emphasizing that it does not include items such as accounts payable and accrued liabilities; only the items specified.

2. Assess Hershey’s solvency compared with the following industry averages for the food processing industry as provided by Reuters and with ratios computed for Tootsie Roll , a competitor in the candy manufacturing, marketing, sales, and distribution industry. See a description of the food processing industry inproblem.

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Reuters Averages (as of August 31, 2012) Not available 46.05% Tootsie Roll (year ended December 31, 2011) 0.0%* 0.0%* Total-debt-to-total-assets Total-debt-to-total-shareholders' equity *Tootsie Roll has no debt in its capital structure! In fact, total liabilities are only 22.4% of total assets.