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Analysis and Interpretation of Liquidity and Solvency Balance sheets and income statements for 3 M Company follow. 3 M COMPANY Consolidated Statements of Income For

Analysis and Interpretation of Liquidity and Solvency
Balance sheets and income statements for 3M Company follow.
3M COMPANY
Consolidated Statements of Income
For Years Ended December 31($ millions)20182017
Net sales $32,765 $31,657
Operating expenses
Cost of sales 16,68216,055
Selling, general and administrative expenses 7,6026,626
Research, development and related expenses 1,8211,870
Gain on sale of businesses (547)(586)
Total operating expenses 25,55823,965
Operating income 7,2077,692
Other expense, net*207144
Income before income taxes 7,0007,548
Provision for income taxes 1,6372,679
Net income including noncontrolling interest 5,3634,869
Less: Net income attributable to noncontrolling interest 1411
Net income attributable to 3M $5,349 $4,858
* Interest expense, gross is $350 million in 2018 and $322 million in 2017.
3M COMPANY
Consolidated Balance Sheets
At December 31($ millions)20182017
Current assets
Cash and cash equivalents $2,853 $3,053
Marketable securities 3801,076
Accounts receivable 5,0204,911
Total inventories 4,3664,034
Prepaids 741937
Other current assets 349266
Total current assets 13,70914,277
Property, plant and equipment, net 8,7388,866
Goodwill 10,05110,513
Intangible assetsnet 2,6572,936
Other assets 1,3451,395
Total assets $36,500 $37,987
Current liabilities
Short-term borrowings and current portion of long-term debt $1,211 $1,853
Accounts payable 2,2661,945
Accrued payroll 749870
Accrued income taxes 243310
Other current liabilities 2,7752,709
Total current liabilities 7,2447,687
Long-term debt 13,41112,096
Pension and postretirement benefits 2,9873,620
Other liabilities 3,0102,962
Total liabilities $26,652 $26,365
3M Company shareholders equity
Common stock par value 99
Additional paid-in capital 5,6435,352
Retained earnings 40,63639,115
Treasury stock (29,626)(25,887)
Accumulated other comprehensive income (loss)(6,866)(7,026)
Total 3M Company shareholders equity 9,79611,563
Noncontrolling interest 5259
Total equity 9,84811,622
Total liabilities and equity $36,500 $37,987
Required
a. Compute the current ratio and quick ratio for 2018 and 2017.
Note: Round your answers to two decimal places (for example, enter 6.78 for 6.77555).
20182017
Current ratio Answer
1.89
Answer
1.86
What is the Quick ratio ?
2018?
2017?

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