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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. (Click the icon to view the financial statements.) Required 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? (Challenge) 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 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 i Financial statements Sobeys Sony Daimler (amounts in millions or billions) Sobeys 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 places.) Income data = Times-interest-earned ratio Total revenues ................. Operating income ............... Sobeys $13,653 341 44 197 8,255 200 38 123 152,389 2,081 922 3 ,227 Sony Daimler Based on your computed ratio values, which company looks the least risky? Interest expense . . . . . . . . . . . . ... Net income ........ Asset and liability data Total current assets .............. Long-term assets ............. Total current liabilities ............ Long-term liabilities . . . . . . . . . . . . . . Shareholders' equity ........... O A. Sobeys OB. Sony O C. Daimler OD. They all look fairly similar $1,335 2,704 1,270 734 2,035 3,859 7,038 3,239 4,267 3,391 93,197 97,091 6 0,017 95,950 34,321
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