Step 1. Circle which ratio is better, either the industry or Starbucks. Step 2. Provide a very brief explanation for which you think is best.

	Industry	Starbucks	Provide a brief explanation for which you think is best.
LIQUIDITY
Current ratio (CA/CL)	1.3	1.8
Net Working Capital (CA-CL)	25,000	250,000
Quick ratio ((CA-Inv.)/CL)	1.1	1.4
CAPITAL STRUCTURE
D/E (or TL/TE)	.60	1.20
D/A (or TL/TA)	.50	0.70
CD/TD (or Current L/Total L)	.40	.50
PERFORMANCE
Gross Profit Margin % ((Sales-CoGS)/sales)	25	30
COGS % Sales (CoGS/Sales)	75	70
NP % Sales (NP/Sales)	11	6
RR Assets % (NP/TA)	8	5
RR Net Worth % (NP/SE)	7	4
SAE % Sales (Selling General & Admin./Sales)	10	12
ACTIVITY
Inventory Turnover (COGS/Inv)	6.5	11.5
Inventory Days (365/Inventory Turnover)	56.15 (57)	31.74 (32)
AR Turnover (Sales/AR)	8.5	6.5
AR Days (365/AR Turnover)	42.94 (43)	56.15 (57)
FA Turnover (Sales/NFA)	2.5	1.7
TA Turnover (Sales/TA)	2.0	1.5