Formulating Financial Statements from Raw Data

Following is selected financial information from General Mills, Inc., for its fiscal year ended May 29, 2016 ($ millions):

Revenue$16,563.1Cost of goods sold

$10,733.6Cash from operating activities2,629.8Cash, ending year

763.7Cash, beginning year334.2Total liabilities

16,405.2Stockholders' equity5,307.1Cash from investing activities

93.4Noncash assets20,948.6Total expenses (other than cost of goods sold)

4,092.7Cash from financing activities*(2,293.7)*Cash from financing activites includes the effects of foreign exhange rate fluctuations.

(a) Prepare the income statement, the balance sheet, and the statement of cash flows for General Mills for the fiscal year ended May 29, 2016.

Hint: Enter negative numbers only for answers in the statement of cash flows (if applicable).

General Mills, Inc.Income Statement ($ millions)

For Year Ended May 29, 2016

Revenue$Answer

0.00 points out of 1.00

Answer

Cash, ending yearTotal expensesCost of goods soldNoncash assets

Answer

0.00 points out of 1.00

Gross profitAnswer

0.00 points out of 1.00

Answer

Cash, ending yearTotal expensesCost of goods soldNoncash assets

Answer

0.00 points out of 1.00

Net income$Answer

0.00 points out of 1.00

General Mills, Inc.

Balance Sheet ($ millions)

May 29, 2016

Cash$Answer

0.00 points out of 1.00

Total liabilities$Answer

0.00 points out of 1.00

Answer

Cash, beginning yearNoncash assetsStockholders' equityNet income

Answer

0.00 points out of 1.00

Answer

Cash, beginning yearNoncash assetsStockholders' equityNet income

Answer

0.00 points out of 1.00

Total assets$Answer

0.00 points out of 1.00

Total liabilities and equity$Answer

0.00 points out of 1.00

General Mills, Inc.Statement of Cash Flows ($ millions)

For Year Ended May 29, 2016

Cash from operating activities$Answer

0.00 points out of 1.00

Answer

Noncash assetsNet incomeCash, beginning yearCash from investing activities

Answer

1.00 points out of 1.00

Cash from financing activitiesAnswer

0.00 points out of 1.00

Net change in cashAnswer

0.00 points out of 1.00

Answer

Noncash assetsNet incomeCash, beginning yearCash from investing activities

Answer

0.00 points out of 1.00

Cash, ending year$Answer

0.00 points out of 1.00

(b) Does the negative amount for cash fromfinancing activities concern us? Explain.

A negative amount for cash from financing activities implies that the company is unable to pay its debts as they come due and should be interpreted negatively.

A negative amount for cash from financing activities is the result of additional borrowings. Because the additional funds are invested in earnings-generating assets, this should be viewed positively.

A negative amount for cash from financing activities implies that the market value of the company's long-term debt has declined and this change should be viewed negatively.

A negative amount for cash from financing activities reflects the reduction of long-term debt, which is a positive sign of the company's ability to retire debt obligations.

(c) Using the statements prepared for part a. compute the following ratios (for this part only, use the year-end balance instead of the average for assets and stockholders' equity):

Round all answers to two decimal places (example for percentage answers:0.12345 = 12.35%).

(i) Profit margin

Answer

0.00 points out of 1.00

%

(ii) Asset turnover

Answer

0.00 points out of 1.00

(iii) Return on assets

Answer

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%

(iv) Return on equity

Answer

0.00 points out of 1.00

%