This problem is based on the 2017 annual report of Campbell Soup Company. Required: a. Compute the following profitability measures for the year ended July 30, 2017 (Dividends declared were $1.40 per common share): 1. Return on investment, based on net earnings (perform a Du Pont analysis) 2. Return on equity, based on net earnings and total equity. 3. Price/earnings ratio. Use $52.85 as the year-end market price 4. Dividend yield. Use $52.85 as the year-end market price. 5. Dividend payout ratio. b. Compute the following liquidity measures at July 30, 2017: 1. Working capital. 2. Current ratio. 3. Acid-test ratio. c. Compute the following activity measures for the year ended July 30, 2017: 1. Number of days' sales in accounts receivable, based on a 365-day year. 2. Number of days' sales in inventory, based on a 365-day year. 3. Accounts receivable turnover. 4. Inventory turnover. 5. Turnover of net property, plant, and equipment d. Compute the following financial leverage measures at July 30, 2017: 1. Debt ratio 2. Debt/equity ratio. e. Compute the following physical measures of Campbell's profitability at July 30, 2017: (Note: In a page not reproduced in the appendix, Campbell's 2017 annual report disclosed that on July 30, 2017, the company had approximately 18,000 employees.) 1. Net sales per employee. 2. Operating income per employee CAMPBELL SOUP COMPANY Consolidated Statements of Earnings (millions, except per share amounts) 2017 2016 2015 Net sales 8,082 7,890 $ 7,961 Costs and expenses Cost of products sold 4,831 5,181 5,300 Marketing and selling expenses Administrative expenses 817 893 884 488 641 601 Research and development expenses 98 124 117 Other expenses / income) 238 131 24 Restructuring charges. . Total costs and expenses 18 31 102 6,490 7,001 7,028 Earnings before interest and taxes 1,054 1,400 960 Interest expense. 112 115 108 Interest income 3 5 4 Earnings before taxes 1.293 849 949 Taxes on eamings 406 286 283 Net earnings 887 563 666 Less: Net eamings (loss) attributable to noncontrolling interests Net earnings attributable to Campbell Soup Company $ 887 563 S 666 Per Share Basic Net earnings attributable to Campbell Soup Company 2.91 $ 1.82 $ 2.13 Weighted average shares outstanding basic 305 309 312 Per Share Assuming Dilution Net earnings attributable to Campbell Soup Company 2.89 $ 1.81 2.13 Weighted average shares outstanding assuming dilution 307 311 313 See accompanying Notes to Consolidated Financial Statements. CAMPBELL SOUP COMPANY Consolidated Balance Sheets (imillions, except per share amounts) July 31, 2016 July 30, 2017 Current assets Cash and cash equivalents 319 $ 296 Accounts receivable, net 605 626 Inventories 902 940 Other current assets 74 46 Total current assets. 1,900 1,908 Plant assets, net of depreciation Goodwill 2,407 2,454 2,115 2,263 Other intangible assets, net of amortization 1,118 1,152 Other assets ($51 as of 2017 and $34 as of 2016 attributable to variable interest entity) 139 107 7,726 $ Total assets. 7,837 Current liabilities Short-term borrowings 1,037 1,219 Payable to suppliers and others 610 666 Accrued liabilities 561 604 Dividends payable 111 100 Accrued income taxes 20 22 Total current liabilities 2,395 2,555 Long-term debt Deferred taxes 2,499 2,314 490 396 Other liabilities 697 1,039 Total liabilities 6,081 6,304 Commitments and contingencies Campbell Soup Company shareholders' equity Preferred stock; authorized 40 shares; none issued Capital stock, $.0375 par value; authorized 560 shares; issued 323 shares Additional paid-in capital 12 12 359 354 Eamings retained in the business Capital stock in treasury, at cost Accumulated other comprehensive loss. . . 2,385 1,927 (664) (1,066) (104) (53) 1,637 1,525 Total Campbell Soup Company shareholders' equity. Noncontrolling interests Total equity ..- 8 8 1,645 1,533 Total liabilities and equity 7,726 $ 7,837 See accompanying Notes to Consolidated Financial Statements