I have attached the problem information in a document and the excel sheet given with General Mills 2014 financial statements. I need help with how to calculate how the financial statement rations for GM in 2014 would change.
GENERAL MILLS INC 10K 07/03/2014 Balance Sheet May 25, 2014 ASSETS Current assets: Cash and cash equivalents 867.30 Receivables 1,483.60 Inventories 1,559.40 Deferred income taxes 74.10 Prepaid expenses and other current assets 409.10 Total current assets 4,393.50 Land, buildings, and equipment 3,941.90 Goodwill 8,650-50 Other intangible assets 5,014.30 Other assets 1,145.50 Total assets 23,145.70 LIABILITIES AND EQUITY Current liabilities: Accounts payable 1,611.30 Current portion of longsterm debt 1,250.60 Notes payable 1,111.70 Other current liabilities 1,449.90 Total current liabilities 5,423.50 Longterm debt 6,423.50 Deferred income taxes 1,666.00 Other liabilities 1,643.20 Total liabilities 15,156.20 Redeemable interest 984.10 Stockholders equity: Common stock, 754.6 shares issued, $0.10 75.50 par value Additional paidin capital 1,231.80 Retained earnings 11,787.20 Common stock in treasury, at cost, shares (5,219.40) of 142.3 and 113.8 Accumulated other comprehensive loss (1,340.30) Total stockholders equity 6,534.80 Noncontrolling interests 470.60 Total equity 7,005-40 Total liabilities and equity 23,145.70 May 26, 2013 741.40 1,446.40 1,545.50 123.00 437.60 4,293.90 3,373.10 3,622.20 5,015.10 343.70 22,658.00 1,423.20 1,443.30 599.70 1,327.70 5,293.90 5,926.10 1,339.10 1,952.90 14,562.00 967.50 75.50 1,166.60 10,702.60 (3,687.20) (1,585.30) 6,672.20 456.30 7,123.50 22,658.00 GENERAL HILLS INC 10-K 07/03/2014 Consolidated Statements of Comprehensive Income Fiscal Year 2014 2013 2012 Net earnings, including earnings attributable to redeemable and noncontrolling interests Other comprehensive income (loss), net of tax: Foreign currency translation (11.30) 0.80 (420.10) Net actuarial gain (loss) 206.00 45.00 (504.60) Other fair value changes: Securities 0.30 0.80 (0.20) Hedge derivatives 5.00 24.60 (53.40) Reclassification to earnings: Hedge derivatives (4.60) 12.20 11.50 Amortization of losses and prior service 107.60 98.80 81.70 costs Other comprehensive income (loss), net 303.00 182.20 (885.10) of tax Total comprehensive income 2,164.30 2,074.70 704.00 Comprehensive income (loss) attributable 94.90 61.10 (130.40) to redeemable and noncontrolling interests Comprehensive income attributable to General Mills GENERAL MILLS INC 10-K 07/03/2014 Incnme Statement Net sales Cost of sales Selling, general, and administrative expenses Divestiture (gain) Restructuring, impairment, and other exit costs Operating profit Interest, net Earnings before income taxes and afteritax earnings from joint ventures Income taxes Afteritax earnings from joint ventures Net earnings, including earnings attributable to redeemable and noncontrolling interests Net earnings attributable to redeemable and noncontrolling interests Net earnings attributable to General Mills Earnings per share 7 basic Earnings per share 7 diluted Dividends per share 2014 17,909.60 11,539.80 3,474.30 (65.50) 3.60 2,957.40 302.40 2,555.00 883.30 89.60 1,051.30 36.90 $1,024.40 Fiscal Year 2013 17,774.10 11,350.20 3,552.30 19.80 2,051.00 316.90 2,534.90 741.20 98.80 1,092.50 37.30 $1,055.20 2012 15,557. 10,513. 3,300. 101. 2,552. 351. 2,210. 709. 88. 1,509. 21. $1,557. 90 20 70 60 40 90 50 60 20 10 80 30 Prepare Problem 139 (General Mills). In addition to the problem statement set forth in the textbook, you will need the 2014 income statement and balance sheets for General Mills (GM): GeneralMillsFinancials2014.xlsx Required: . What if General Mills had consolidated its share in its investments that are currently accounted for under the equity method? (In other words, it had combined its share of the assets, liabilities, revenues and expenses of these investments with the amounts already reported in its financial statements.) Show how how the following financial statement ratios for GM in 2014 would change: . Profit margin (net income divided by sales); - Return on assets (net income divided by total assets as of the end of the fiscal year); . Total liabilities divided by total assets; - Total liabilities divided by shareholders equity. . Consider, and be prepared to discuss the pros and cons of two alternatives to the equity method which are not permitted under GAAP, but have been at one time or another been considered as alternatives: . Full consolidation of the investments; - Consolidation of GM's proportionate share of the investments. In its May 25, 2014 balance sheet, General Mills reports a $1,146 million "Other assets" account, of which $506 million are equity method investments in joint ventures. (Note that General Mills' fiscal year end is the last Sunday in May [i.e., the exact date is variable and the fiscal year can be either 52 or 53 weeks in length]. Fiscal years 2014, 2013 and 2012 each consisted of 52 weeks.) The Company discusses its investments in joint ventures in the following footnote to its 2014 SEC Form 10K: We have a 50% equity interest in Cereal Partners Worldwide (CPW), which manufactures and mar kets ready- toeat cereal products in more than 130 countries outside the United States and Canada. CPW also markets cereal bars in several European countries and manufactures private label cereals for customers in the United Kingdom. We have guaranteed a portion of CPW's debt and its pension obli gation in the United Kingdom. We also have a 50% equity interest in HiagenDazs Japan, Inc. (HDJ). This joint venture manufactures and markets Haagen-Dazs ice cream products and frozen novelties. Joint venture related financial information is as follows: (in millions) May 25, 2014 Cumulative investments .............................. $508 Goodwill and other intangibles .................... ..... 563Aggregateadvances.................................332 (in millions) 2014 Total net sales .......................................... $2,499 Grossmargin 1,030 May 26, 2013 $479 537 392 Fiscal Year 2013 2012 $2,553 2,582 1,0571,084 260 250 202 189 May 26, 2013 $ 9771988171? 115 Earnings before income taxes ......................... Earnings after income taxes ........................... (in millions) Currentassets Noncurrentassets Currentliabilities.................................... Noncurrentliabilities................................. ..219....169 May 25, 2014 $1,031 1,030 1,779 110
