Exercise 12-67 (Algorithmic) Short-Term Liquidity Ratios

The financial statements for Giardi Corporation, a retailer, follow.

Giardi Corporation
Consolidated Income Statements
(Millions of dollars, except per share data)		December 31
		2011		2010		2009
Revenues		$19,233		$17,927		$16,115
Costs and expenses:
Cost of retail sales, buying, and occupancy		$14,164		$13,129		$11,751
Selling, publicity, and administration		3,175		2,978		2,801
Depreciation		498		459		410
Interest expense, net		446		437		398
Taxes other than income taxes		343		313		283
	Total costs and expenses	$18,626		$17,316		$15,643
Earnings before income taxes		$ 607		$ 611		$ 472
Provision for income taxes		232		228		171
Net earnings		$ 375		$ 383		$ 301

Giardi Corporation
Consolidated Balance Sheets
(Millions of dollars)
ASSETS		December 31,
		2011		2010
Current assets:
Cash and cash equivalents		$ 321		$ 117
Accounts receivable		1,536		1,514
Merchandise inventories		2,497		2,618
Other		157		165
	Total current assets	$ 4,511		$ 4,414
Property and equipment:
Land		$ 1,120		$ 998
Buildings and improvements		4,753		4,342
Fixtures and equipment		2,162		2,197
Construction-in-progress		248		223
Accumulated depreciation		(2,336)		(2,197)
Net property and equipment		$ 5,947		$ 5,563
Other		320		360
Total assets		$10,778		$10,337
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable		$ 200		$ 23
Accounts payable		1,654		1,596
Accrued liabilities		903		849
Income taxes payable		145		125
Current portion of long-term debt		173		371
	Total current liabilities	$ 3,075		$ 2,964
Long-term debt		4,279		4,330
Deferred income taxes and other		536		450
Loan to ESOP		(217)		(267)
Total liabilities		$ 7,673		$ 7,477
Stockholders' equity:
Preferred stock		$ 368		$ 374
Common stock		72		71
Additional paid-in capital (common)		73		58
Retained earnings		2,592		2,357
Total stockholders' equity		$ 3,105		$ 2,860
Total liabilities and stockholders' equity		$10,778		$10,337

1. Compute the four short-term liquidity ratios for 2010 and 2011 assuming operating cash flows are $281 million and $430 million, respectively. Round your answers to two decimal places.

	2011	2010
Current ratio
Quick ratio
Cash ratio
Operating cash flow ratio