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Posted on Jul 16, 2024

5) Refer to McDonald's balance sheets to answer the following questions. (28 points) . MCDONALD's (MCD) BALANCE SHEET (S in millions) ASSETS 31/12/2010 31/12/2009 31/12/2008

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5) Refer to McDonald's balance sheets to answer the following questions. (28 points) . MCDONALD's (MCD) BALANCE SHEET (S in millions) ASSETS 31/12/2010 31/12/2009 31/12/2008 31/12/2007 Cash and cash equivalents $ 2,387.0 $ 1,796.0 $ 2,063.4 $ 1,981.3 Accounts receivable 1,179.1 1,060.4 931.2 1,053.8 Inventories 109.9 106.2 111.5 125.3 Other current assets 6925 453.7 411.5 421.5 Property, plant, and equipmt $34,4824 $33,440.5 $31,152.4 $32,203.7 Accumulated depreciation (12.421.8 (11.909.0) (10.8979) (11.219.0 PPE, net 22,060.6 21,531.5 20,254.5 20,984.7 Goodwill 2,586.1 2.425.2 2.237.4 2,301.3 Long-term investments 1,335.3 1,212.7 1,222.3 1,156.4 Other noncurrent assets 1,6247 1,639.2 1,229.7 1,367.4 TOTAL ASSETS $31,975.2 $30,224.9 $28.461.5 $29,391.7 LIABILITIES Accounts payable $ 943.9 $ 636.0 $ $ 624.1 Short-term debt 0.0 0.0 0.0 1,126.6 Other current liabilities 1,980.8 2,352.7 1,917.5 2,747.8 Long-term debt 11,497.0 10,560.3 10,186.0 7,310.0 Other noncurrent liabilities 2.919.3 2,642.0 2,355.0 2,303.4 STOCKHOLDERS' EQUITY Common stock, par 16.6 16.6 16.6 16.6 Additional paid-in capital 5,196.4 4,853.9 4,600.2 4,226.7 Retained earnings 33,811.7 31,270.8 28,953.9 26,461.5 Treasury stock (25 143.4) (22,854.8) (20,289.4) (16,762.4) Other stockholders' equity 752.9 747.4 101.3 1,337.4 TOTAL L & SE $31,975.2 $30,224.9 $28,461.5 $29,391.7 620.4 MCDONALD'S (MCD) RATIOS Industry Norm 31/12/2010 31/12/2009 31/12/2008 31/12/2007 Current ratio 1.10 1.39 0.80 Debt ratio 52% 53% 48% a. In regard to assets, this company has a major investment in b. Long-term debt was borrowed during c. This company was able to attract new shareholders during .). As of 31/12/2010 shareholders have contributed a total of ) million to this corporation. e. The assets of this company are primarily financed with ), which is (internal/external) financing, f. For 31/12/2009 and 31/12/2010 compute the current ratio and the debt ratio. Record your results in the area provided above. Ratios for 31/12/2007 and 31/12/2008 have already been computed. 3 g. Review the financial information of this company and comment on signs of financial strength. - warning signs or signs of financial weakness. 5) Refer to McDonald's balance sheets to answer the following questions. (28 points) . MCDONALD's (MCD) BALANCE SHEET (S in millions) ASSETS 31/12/2010 31/12/2009 31/12/2008 31/12/2007 Cash and cash equivalents $ 2,387.0 $ 1,796.0 $ 2,063.4 $ 1,981.3 Accounts receivable 1,179.1 1,060.4 931.2 1,053.8 Inventories 109.9 106.2 111.5 125.3 Other current assets 6925 453.7 411.5 421.5 Property, plant, and equipmt $34,4824 $33,440.5 $31,152.4 $32,203.7 Accumulated depreciation (12.421.8 (11.909.0) (10.8979) (11.219.0 PPE, net 22,060.6 21,531.5 20,254.5 20,984.7 Goodwill 2,586.1 2.425.2 2.237.4 2,301.3 Long-term investments 1,335.3 1,212.7 1,222.3 1,156.4 Other noncurrent assets 1,6247 1,639.2 1,229.7 1,367.4 TOTAL ASSETS $31,975.2 $30,224.9 $28.461.5 $29,391.7 LIABILITIES Accounts payable $ 943.9 $ 636.0 $ $ 624.1 Short-term debt 0.0 0.0 0.0 1,126.6 Other current liabilities 1,980.8 2,352.7 1,917.5 2,747.8 Long-term debt 11,497.0 10,560.3 10,186.0 7,310.0 Other noncurrent liabilities 2.919.3 2,642.0 2,355.0 2,303.4 STOCKHOLDERS' EQUITY Common stock, par 16.6 16.6 16.6 16.6 Additional paid-in capital 5,196.4 4,853.9 4,600.2 4,226.7 Retained earnings 33,811.7 31,270.8 28,953.9 26,461.5 Treasury stock (25 143.4) (22,854.8) (20,289.4) (16,762.4) Other stockholders' equity 752.9 747.4 101.3 1,337.4 TOTAL L & SE $31,975.2 $30,224.9 $28,461.5 $29,391.7 620.4 MCDONALD'S (MCD) RATIOS Industry Norm 31/12/2010 31/12/2009 31/12/2008 31/12/2007 Current ratio 1.10 1.39 0.80 Debt ratio 52% 53% 48% a. In regard to assets, this company has a major investment in b. Long-term debt was borrowed during c. This company was able to attract new shareholders during .). As of 31/12/2010 shareholders have contributed a total of ) million to this corporation. e. The assets of this company are primarily financed with ), which is (internal/external) financing, f. For 31/12/2009 and 31/12/2010 compute the current ratio and the debt ratio. Record your results in the area provided above. Ratios for 31/12/2007 and 31/12/2008 have already been computed. 3 g. Review the financial information of this company and comment on signs of financial strength. - warning signs or signs of financial weakness