Great Earth Homes, Inc., builds environmentally sensitive structures. The company's 2016 revenues totaled $2,770 million. At December 31, 2016 and 2015, the com¬pany had, respectively, $653 million and $583 million in current assets. The December 31, 2016, and 2015, balance sheets and income statements reported the following amounts:

Requirements
1. Describe each of Great Earth Homes, Inc.'s, liabilities and state how the liability arose.
2. What were the company's total assets at December 31, 2016? Evaluate the company's leverage and debt ratios at the end of 2015 and 2016. Use year-end figures in place of averages where needed for the purpose of calculating ratios in this exercise. Did the company improve, deteriorate, or remain about the same over the year?
3. Assume that beginning and ending inventories for both periods did not differ by a material amount. Accounts payable at the end of 2014 was $182 million. Calculate accounts payable turnover as a ratio and days' payable outstanding (DPO) for 2015 and 2016. Calculate current ratios for 2015 and 2016 as well. Evaluate whether the company improved or deteriorated from the standpoint of ability to cover accounts payable and current liabilities over the year

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A1 2016 2015 1 At year-end (In millions) 2 Liabilities and stockholders' equity 3 Current liabilities 4Accounts payable 5 Accrued expenses 6Employee compensation and benefits 7Current portion of long-term debt $ 178S 170 178 31 16 395 1,324 131 23 1701 1175 $3,569 $3,048 112 20 Total current liabilities 315 1,379 165 9 Long-term debt 10 Post-retirement benefits payable 11 Other liabilities 12 Stockholders' equity 13 Total liabilities and stockholders' equity 14 Year-end (in millions) 15 Cost of goods sold 16 $2784 $2464