Hill Sports Company reported the following in recent balance sheets (amounts in millions).

(in millions)

June 30, 2019

December 31, 2018

Assets

Current Assets

Cash

$ 549

$ 550

Accounts Receivable

1,417

552

Inventory

1,724

717

Prepaid Rent

96

52

Total Current Assets

3,786

1,871

Software

594

212

Equipment

2,025

695

Total Assets

$ 6,405

$ 2,778

Liabilities and Shareholders' Equity

Liabilities

Current Liabilities

Accounts Payable

$ 1,015

$ 720

Notes Payable (short-term)

0

2

Income Tax Payable

96

5

Total Current Liabilities

1,111

727

Notes Payable (long-term)

226

127

Total Liabilities

1,337

854

Stockholders Equity

Common Stock

212

64

Retained Earnings

4,856

1,860

Total Shareholders Equity

5,068

1,924

Total Liabilities and Shareholders Equity

$ 6,405

$ 2,778

Required:

2. 1. Calculate the current ratio at June 30, 2019, and December 31, 2018.
3. 2-a. Did the companys current ratio increase or decrease?
4. 2-b. What does this imply about the companys ability to pay its current liabilities as they come due?
5. 3-a. What would Hill Sports current ratio have been on June 30, 2019, if the company were to have paid down $10 (million) of its Accounts Payable?
6. 3-b. Does paying down Accounts Payable in this case increase or decrease the current ratio?
7. 4. Are the companys total assets financed primarily by liabilities or stockholders equity at June 30, 2019?

Calculate the current ratio at June 30, 2019, and December 31, 2018. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

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Current Ratio			June 30, 2019			December 31, 2018
Numerator		=		=	0		=	0
Denominator

What would Hill Sports current ratio have been on June 30, 2019, if the company were to have paid down $10 (million) of its Accounts Payable? (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

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Current Ratio
Numerator		=		=	0
Denominator

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