Amazon.com, Inc. (AMZN) is one of the largest Internet retailers in the world. Best Buy, Co. In however, Best Buy sells through both traditional retail stores and the Internet, while Amazon se Amazon Best Buy Current assets: Cash $19,334 $1,976 Short-term investments 6,647 1,305 Accounts receivable 8,339 1,162 Inventories 11,461 5,051 Other current assets 392 Total current assets $45,781 $9,886 Current liabilities: Accounts payable $25,309 $ 4,450 Other current liabilities 18,507 2,475 Total current liabilities $43,816 $6,925 Required: a. Compute working capital for each company. Amazon: $ Best Buy: $ b. Compute the current ratio for each company. Round to one decimal place. Amazon: Best Buy: c. Compute the quick ratio for each company. Round to one decimal place. Amazon: Best Buy: d. Can the working capital be usefully compared between the two companies? Which of the following s Yes, working capital is a good measure for comparing the liquidity of two companies becaus e. Which company has the greater debt-paying ability according to the current ratio? Best Buy Best Buy Which company has the greater short-term debt-paying ability according to the quick ratio? Amazon g. Why are the results different between (e) and (f)? (Hint: Perform a vertical analysis of the curren Amazon Best Buy Current assets: Cash Short-term investments % % % % Accounts receivable Inventories % % % % Other current assets % % Total current assets % % Amazon has % of its current assets consisting of cash and short-term investments, comp its current assets in inventory, while Amazon only has 25.0% of current assets in inventory. This differ relationship between the current and quick ratios to diverge between the two companies. g. Why are the results different between (e) and (f) (Hint: Perform a vertical analysis of the current assets) Round to one decimal place Current assets: Cash Short-term investments Accounts receivable Inventories Other current assets Total current assets Amazon has Amazon % $6 % Best Buy % of its current assets consisting of cash and short-term investments, compared to % for Best Buy This difference will impr its current assets in inventory, while Amazon coly has 25.0% of current assets in inventory. This difference reflects Amazon's pure Internet strategy, which causes the set radiator & relationship between the current and quick ratios to diverge between the two companies. Feedback