The 2011 financial statements and 10-year financial review of Canadian Tire Corporation, Limited can be found at
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(a) What makes up Canadian Tire's current liabilities? Suggest at least five different types of liabilities that are likely included in Trade and Other Payables. What is included in Deposits?
(b) What were Canadian Tire's working capital, acid-test ratio, and current ratio for the two most recent years of data that are provided? How do these results compare with the measures for five years ago? Comment on the company's current liquidity in general, and compared with its liquidity five years ago. What role does the inventory turnover have in assessing liquidity in general, and for Canadian Tire specifically? What is in the accounts receivable and what role does it play in assessing liquidity for Canadian Tire? Can a turnover ratio be calculated for these accounts receivable?
(c) What is the current portion of long-term debt? Explain clearly what makes up this amount. If the company does not borrow any additional long-term funds during 2012, how much would you expect to see on the 2012 balance sheet as the current portion of long-term debt? Explain clearly what would make up this amount. Are there any concerns arising from this amount?
(d) What types of commitments and contingencies has Canadian Tire reported in its financial statements? Identify which items are commitments and which are contingencies. What is management's reaction to the contingencies?
(e) What covenants does the company have to maintain under its existing debt agreements? Was it in compliance at the year end?
Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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a Canadian Tires current liabilities include the following amounts 2010 millions Balance Bank indebtedness 1248 Deposits 11823 Trade and other payables 16409 Provisions 1919 Shortterm borrowings 3526 ...View the full answer
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