Companies that operate in different industries may have very different financial ratio values. These differences may grow even wider when we compare companies located in different countries.

Compare three fictitious companies (Albertson, Millstone, and Raleigh) by calculating the following ratios: current ratio, debt ratio, leverage ratio, and times-interest-earned ratio. Use year-end figures in place of averages where needed for calculating the ratios in this exercise.

Based on your computed ratios, which company looks the least risky?

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A1 1 (Amounts in millions or billions) 2 Income data 3 Total revenues 4 Operating income 5 Interest expense 6 Net income 7 Assets and liability data 8 (Amounts in millions or billions) 9 Total current assets 10 Long-term assets 11 Total current liabilities 12 Long-term liabilities 13 Common stockholders' equity Millstone Raleigh Albertson $ 9,723 291 41 € 136,384 5,584 655 ¥ 7,311 222 26 16 21 441 434 4,832 573 2,237 2,303 865 126,700 68,297 72,400 110,897 11,700 96 247 97 186 14