Question

Examine the partial balance sheet of Altria Group shown below and answer the following questions.
1. Current assets for Altria Group (parent company of Philip Morris) totaled $25,901 (in millions) at the end of 2004. Compute the company’s current ratio.
2. Why would Altria classify its liabilities into two different categories?
3. Compute Altria’s debt-to-equity ratio for 2004 using
(a) Only long-term debt and
(b) All liabilities in your computations.
Why the huge difference in your answers? When interpreting a debt-to-equity ratio computed by someone else, what should be your firstquestion?


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  • CreatedApril 07, 2012
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