Refer to the financial statements and the accompanying notes of Cadbury plc, available online and of The Nestlé Group, given in Appendix A. Nestlé uses the Swiss franc (CHF) in preparing its financial statements, whereas Cadbury reports its financial information by using the pound sterling (£). Use the exchange rates indicated in requirements 1 and 2 below to convert the pounds sterling into Swiss francs so you can compare the specific financial statement elements for both companies.

Required:

1. Which company is larger in terms of total assets? The exchange rate between the two currencies was \(£ 1=\) CHF 1.53 at December 31, 2008.

2. Compute the debt-to-equity ratio for both companies. Which company is assuming more risk? Why do you think that?

3. In the most recent year, what were the net cash flows (i.e., the increases in cash minus the decreases in cash) related to the buying and selling of investments for each company?

4. How much did each company pay in dividends for the most recent year?

5. What account title does each company use to report any land, buildings, and equipment it may have?