Chapter 9: Discussion Assignment #4 Learning Outcomes define the valuation and reporting of current liabilities, estimated liabilities, and other contingencies. interpret company solvency through selection and application of appropriate financial analysis tools. Example Follow through this example for McDonald's from reporting year ended 2018 to help you to understand how to write your post for the current year 10-K form 2020. Access the December 31, 2018 annual 10-K report of McDonald's Corporation (ticker, MCD), which is available at this link McDonald's Corporation 10-K for 2018 The Financial Statements begin on page 32, have a look. The first challenge is to list the names of the current liabilities. To do this you need to look at the Consolidated Balance Sheet. It is on page 34. Under the Liabilities and Shareholders' Equity section note the Current Liabilities. The current liabilities include for 2018: Accounts payable Income taxes Other taxes Accrued interest Accrued payroll and other liabilities Next, to compute the times interest eamed ratio for December 31, 2018 first find the formula in our textbook. Write it down. Next find the Consolidated Income Statement in the McDonald's 2018 annual report. Times interest earned for McDonald's is $ millions 12/31/2018 Net Income. $ 5,924.3 Plus income taxes 1,891.8 Plus interest expense.. 9812 Income before interest and taxes $ 8.797.3 Times interest eamed. 8.97 times McDonald's ratio is higher than the industry average of 5.0 in 2018. Accordingly, its times interest earned ratio seems sufficient for McDonald's to cover its interest obligations Instructions for your post Access the December 31, 2020 annual 10-K report of McDonald's Corporation (ticker: MCD), which is available at this link. McDonald's Corporation 10-K e for 2020. The Annual Report format available for McDonald's Corporation for 2020 looks slightly different than the 2018 in the example, however the same information is included as mentioned below, Locate the Financial Statements and Supplementary Data starting on page 37. Notice that the financial statements we have been studying are located starting on page 38 through page 42. Using the information provided on the financial statements to answer the following two questions: 1. Identify the current liabilities on McDonald's balance sheet as of December 31, 2020. List each of the current liabilities by name. You to include dollar amounts 2. Use the consolidated statement of income for the year ended December 31, 2020, to compute McDonald's times interest earned ratio. do not net