Review the 2004 balance sheet data for Hewlett-Packard (HP) and Dell shown below. 1. Compute each companys

Question:

Review the 2004 data for Hewlett-Packard (HP) and Dell shown below.

Review the 2004 balance sheet data for Hewlett-Packard (HP) and

1. Compute each company€™s current ratio for 2004. Based on the result, which company appears to be more liquid?
2. Compute each company€™s debt-to-equity ratio for 2004. Which company appears to have the most debt in relation to stockholders€™ equity?
3. Which company has a larger amount of long-term debt in its financing mix?
4. Why would HP have such a large amount in retained earnings at the end of 2004 relative toDell?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...