Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Question 4 Partially correct Mark 0.19 out of 3.00 Flag question Compute Ratios from Statement of Cash Flow Information Use the following information, taken from

image text in transcribed

Question 4 Partially correct Mark 0.19 out of 3.00 Flag question Compute Ratios from Statement of Cash Flow Information Use the following information, taken from each of the company's 2018 financial statements to complete the requirements. Cash from Current Company Operations Liabilities CAPEX Arconic Inc. $217 $3,520 $768 Carmax Inc. 163 1,312 305 Flowserve Corp. 1,081 84 Fluor Corp. 162 3,553 211 191 a. Compute the operating cash flow to current liabilities ratio for each company. b. Rank-order each company from low to high liquidity (ability to pay liabilities as they come due). Do any of the companies have liquidity difficulties? C. Compute the operating cash flow to CAPEX ratio for each company. Compared with the rule of thumb of 1.0, assess each company's solvency as either low, medium, or high. d. Rank-order each company from low to high solvency, Do any of the companies have solvency difficulties? Round answers to two decimal places. For ranking, 1 is the highest and 4 is the lowest. Liquidity Rank Solvency Rank Company Arconic Inc Carmax Inc. Flowserve Corp. Fluor Corp. Operating Cash Flow to Current Liabilities 0.33 X 4 2.62 X 1 1.12 x 2 0.53 X 3 Operating Cash Flow to CAPEX 0.89 x 4 X 5.68 X 1 x 3.08 x 2 x 1.39 X 3 x * * *

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial and Managerial Accounting

Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac

13th edition

978-1285866307

Students also viewed these Accounting questions