Selected financial ratios from the (i) S&P 400, (ii) the brewing industry, and (iii) Anheuser-Busch Companies (BUD), for Years 2 through 6 are reproduced below.

Required:

a. Using these financial ratios, analyze the relative credit position of:

(1) Brewing industry compared with the S&P 400.

(2) Anheuser-Busch compared with the brewing industry.

(3) Anheuser-Busch compared with the S&P 400.

b. Using these financial ratios and your analysis from (a), describe the current position of Anheuser-Busch and discuss whether you feel there has been a change in the credit quality of Anheuser-Busch during this five-year period.

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YEAR 2 YEAR 4 YEAR 3 YEAR 5 YEAR 6 S&P Brewing S&P Brewing 400 Industry BUD Brewing Brewing SEP S&P Brewing 400 Industry BUD SEP Industry BUD 400 Industry BUD Industry BUD 400 400 Current ratio. Quick ratio. Long-term debt/Total assets (%). 24 Total debt ratio (%)* Times interest earned. Cash flow/Long-term debt (%). Cash flow/Total debt (%)*. Total asset turnover.. Net profit margin (%). Return on assets (%) 1.3 0.9 1.5 1.2 1.5 0.7 1.1 1.4 1.0 0.4 19 37 9.8 73 38 1.4 6.17 8.89 1.1 0.9 1.5 1.4 0.8 18 1.3 1.5 1.2 0.6 1.4 0.7 1.4 0.7 21 43 0.4 0.05 0.8 26 1.0 0.8 17 34 0.8 0.7 17 27 25 22 15 44 25 18 34 15 48 23 41 33 48 14.9 3.6 11.0 79 51 40 20 37 4.0 42 12.2 36 39 7.5 31 4.8 32 4.2 10.1 57 7.2 12.7 55 7.6 13.3 4.6 54 52 23 43 61 26 70 35 65 84 25 71 38 88 20 80 38 1.1 29 1.2 25 32 39 40 1.2 1.6 1.2 3.95 5.36 4.64 6.46 1.2 1.2 6.3 1.4 1.5 4.77 5.12 5.80 7.47 1.2 3.84 5.73 4.41 7.66 1.3 1.3 1.4 5.8 8.0 1.5 6.3 3.75 6.16 3.97 7.90 8.7 4.42 5.58 5.10 7.98 6.0 8.7 7.4