Key comparative figures ($ thousands) for Krispy Kreme and Tastykake follow:

Required 1. Compute the recent two years’ cash flow on total assets ratios for both Krispy Kreme and Tastykake.
2. What does the cash flow on total assets ratio measure?
3. Which company has the higher cash flow on total assets ratio for the periods shown?
4. Does the cash flow on total assets ratio reflect on the quality of earnings? Explain.

Transcribed Image Text:

Key Figures Operating cash flows. Total assets Krispy Kreme Current Year | Year Prior 2 Years Prior Current Year $ 51,036 $ 36,210 $ 32,112 $ 10,115 410,487 255,376 171,493 116,560 Tastykake 1 Year Prior $ 10,905 2 Years Prior $ 13,199 116,136 112,192