McDonald's 2006 financial statements contain the following selected data (in millions). Instructions (a) Compute the following values
Question:
McDonald's 2006 financial statements contain the following selected data (in millions).
Instructions
(a) Compute the following values and provide a brief interpretation of each.
(1) Working capital.
(2) Current ratio.
(3) Debt to total assets ratio.
(4) Times interest earned ratio.
(b) The notes to McDonald's financial statements show that subsequent to 2006 the company will have future minimum lease payments under operating leases of $11,119.8 million. If these assets had been purchased with debt, assets and liabilities would rise by approximately $9,900 million. Recompute the debt to total assets ratio after adjusting for this. Discuss yourresult.
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...
Step by Step Answer:
Financial Accounting Tools for Business Decision Making
ISBN: 978-0470239803
5th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso