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Companies that operate in different industries may have very different financial ratio values. These differences may grow even wider when we compare companies located in
Companies that operate in different industries may have very different financial ratio values. These differences may grow even wider when we compare companies located in different countries. 2 (Click the icon to view the financial statements.) Requirement Compare three leading companies on their current ratio, debt ratio, and times-interest-earned ratio. Compute three ratios for Sobeys (the Canadian grocery chain), Sony (the Japanese electronics manufacturer), and Daimler (the German auto company). Based on your computed ratio values, which company looks the least risky? Begin by computing the ratios. Start by selecting the formula for the current ratio. Then, calculate the current ratios for Sobeys, Sony, and Daimler. (Enter amounts in millions or billions as provided to you in the problem statement. Round the current ratios to two decimal places.) Current ratio Sobeys Sony 4 Daimler Next, select the formula for the debt ratio. Then, calculate the debt ratios for Sobeys, Sony, and Daimler. (Enter amounts in millions or billions as provided to you in the problem statement. Round the debt ratios to two decimal places.) / Debt ratio Sobeys / 1 Sony Daimler Next, select the formula for the times-interest-earned ratio. Then, calculate the times-interest-earned ratios for Sobeys, Sony, and Daimler. (Enter amounts in millions or billions as provided to you in the problem statement. Round the times-interest-earned ratios to two decimal places.) Times-interest-eamed ratio X 1 - = Financial statements Sobeys Sony Daimler 1 = 2 Based on your computed ratio values, which company looks the least risky? (amounts in millions or billions) Sobeys Sony Daimler Income data Total revenues $ 13,653 O A. Sony O B. Daimler OC. Sobeys OD. They all look fairly similar. 340 8.280 152,389 199 2,080 38 922 44 Operating income Interest expense Net income Asset and liability data 203 132 3,233 Total current assets $ 1,635 3,204 Long-term assets \ 4,159 7,538 3,217 1,250 Total current liabilities....... Long-term liabilities.............. Shareholders' equity 93,540 97,591 59,997 95.890 35,244 674 4.198 4.282 2,915
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