Please help: Using data from these two companies: The first one is from P&G, and the second balance sheet is from General Mills.
Evaluate the LIQUIDITY of each company 1. Compute each company's 2019 Current Ratio, and Acid Test ratio. 2. Explain which company you rate higher on liquidity. Consolidated Balance Sheets 2019 2018 4,239 $ 6,048 4,951 2,569 9,281 4,686 Amounts in millions; As of June 30 Assets CURRENT ASSETS Cash and cash equivalents Available-for-sale investment securities Accounts receivable INVENTORIES Materials and supplies Work in process Finished goods Total inventories Prepaid expenses and other current assets TOTAL CURRENT ASSETS PROPERTY, PLANT AND EQUIPMENT, NET GOODWILL TRADEMARKS AND OTHER INTANGIBLE ASSETS, NET OTHER NONCURRENT ASSETS TOTAL ASSETS 1,289 612 3,116 5,017 2,218 22,473 21,271 40,273 24,215 6,863 115,095 1,335 588 2,815 4,738 2,046 23,320 20,600 45,175 23,902 5,313 118,310 $ $ $ 11,260 9,054 9,697 30,011 20,395 6,899 10,211 67,516 10,344 7,470 10,423 28,237 20,863 6,163 10,164 65,427 Liabilities and Shareholders' Equity CURRENT LIABILITIES Accounts payable Accrued and other liabilities Debt due within one year TOTAL CURRENT LIABILITIES LONG-TERM DEBT DEFERRED INCOME TAXES OTHER NONCURRENT LIABILITIES TOTAL LIABILITIES SHAREHOLDERS' EQUITY Convertible Class A preferred stock, stated value $1 per share (600 shares authorized) Non-Voting Class B preferred stock, stated value $1 per share (200 shares authorized) Common stock, stated value $1 per share (10,000 shares authorized; shares issued: 2019 - 4,009.2, 2018 - 4,009.2) Additional paid-in capital Reserve for ESOP debt retirement Accumulated other comprehensive income/(loss) Treasury stock, at cost (shares held: 2019 - 1,504.5, 2018 -1,511.2) Retained earnings Noncontrolling interest TOTAL SHAREHOLDERS' EQUITY TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 928 - 967 - 4,009 63,827 (1,146) (14,936) (100,406) 94,918 385 47,579 115,095 4,009 63,846 (1,204) (14,749) (99,217) 98,641 590 5 2,883 118,310 $ $ Consolidated Balance Sheets GENERAL MILLS, INC. AND SUBSIDIARIES (In Millions, Except Par Value) May 26, 2019 May 27, 2018 $ 450.0 1,679.7 1,559.3 497.5 4,186.5 3,787.2 13,995.8 7,166.8 974.9 30.111.2 399.0 1,684.2 1.642.2 398.3 4,123.7 4,047.2 14,065.0 7,445.1 943.0 30,624.0 S $ $ ASSETS Current assets: Cash and cash equivalents Receivables Inventories Prepaid expenses and other current assets Total current assets Land, buildings, and equipment Goodwill Other intangible assets Other assets Total assets LIABILITIES AND EQUITY Current liabilities: Accounts payable Current portion of long-term debt Notes payable Other current liabilities Total current liabilities Long-term debt Deferred income taxes Other liabilities Total liabilities Redeemable interest Stockholders' equity: Common stock, 754.6 shares issued, $0.10 par value Additional paid-in capital Retained earnings Common stock in treasury, at cost, shares of 152.7 and 161.5 Accumulated other comprehensive loss Total stockholders' equity Noncontrolling interests Total equity Total liabilities and equity 2,854.1 1,396.5 1,468.7 1,367.8 7,087.1 11,624.8 2,031.0 1,448.9 22,191.8 551.7 2,746.2 1,600.1 1,549.8 1,445.8 7.341.9 12.668.7 2.003.8 1,341.0 23,355.4 776.2 75.5 1,386.7 14,996.7 (6,779.0) (2,625.4) 7,054.5 313.2 7,367.7 30.111.2 75.5 1,202.5 14,459.6 (7,167.5) (2,429.0) 6,141.1 351.3 6,492.4 30,624.0 $ $
