1. compute the for short-rerm liquidity ratios for 2010 and 2012 assuming operating cash flows are $281 million and $510 million. round two decimal places.

2. indicate which ratios appear to be most appropriate for a reatil organization.

Exercise 12-67 (Algorithmic) Short-Term Liquidity Ratios The financial statements for Giardi Corporation, a retailer follow. Giardi Corporation Consolidated Income Statements (Millions of dollars, except per share data) December 31 2011 2010 2009 Revenues $19,233 $17,927 $16,115 Costs and expenses: Cost of retail sales, buying, and occupancy Selling, publicity, and administration Depreciation $13,129 2,978 $14,164 3,175 498 446 $11,751 2,801 410 459 437 398 Interest expense, net Taxes other than income taxes 343 313 283 Total costs and expenses $18,626 $17,316 $15,643 Earnings before income taxes $ 607 $ 611 $ 472 Provision for income taxes 232 228 Giardi Corporation Consolidated Balance Sheets (Millions of dollars) ASSETS December 31, 2011 2010 Current assets: Cash and cash equivalents $ 321 $ 117 Accounts receivable 1,536 2,497 1,514 2,618 Merchandise inventories Other 165 Total current assets $ 4,511 $ 4,414 Property and equipment: Land Buildings and improvements Fixtures and equipment Construction-in-progress Accumulated depreciation $ 1,120 $ 998 4,753 4,342 2,162 2,197 248 223 (2,336) (2,197) $ 5,947 $ 5,563 320360 Net property and equipment Other Total assets $10,778 $10,337 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable $ 200 $ 23 1.654 1,596 903 849 145 125 371 173 Accounts payable Accrued liabilities Income taxes payable Current portion of long-term debt Total current liabilities Long-term debt Deferred income taxes and other Loan to ESOP Total liabilities Stockholders' equity: $ 3,075 4,279 $ 2,964 4,330 536 450 (217) $ 7,673 (267) $ 7,477 Preferred stock Common stock 71 Additional paid-in capital (common) $368 $ 374 72 7358 2,592 2,357 $ 3,105 $ 2,860 Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $10,778 $10,337 1. Compute the four short-term liquidity ratios for 2010 and 2011 assuming operating cash flows are $281 million and $510 million, respectively. Round your answers to two decimal places. 2011 Current ratio Quick ratio Cash ratio Operating cash flow ratio 2. Conceptual Connection: Indicate which ratios appear to be most appropriate for a retail organization. Indicate what other information you would like to know to comment on Giardi's short-term liquidity, The input in the box below will not be graded, but may be reviewed and considered by your instructor