Metro Inc. is one of Canada’s leading food retailers and distributors and operates a network of supermarkets, discount stores, and drugstores. Exhibits 10-8A and B include the company’s statement of financial position and Note 20 to the company’s 2013 financial statements, which provides details of Metro’s debt.
a. Metro Inc. had a $600-million revolving credit facility in place at September 28, 2013. What is a revolving credit facility?
b. The revolving credit facility is described as unsecured. What does this mean?
c. The company also had $600 million in notes outstanding (Series A and Series B notes) at September 28,
2013. When do these notes have to be repaid to the note holders?
d. What is the annual interest expense that Metro Inc. incurs on the $600 million in outstanding notes?
e. Metro Inc. has a number of objectives in relation to its management of capital. One of these corporate objectives is to have a percentage of interest-bearing, non-current debt to total combined interest-bearing, non-current debt and equity (non-current debt/total capital ratio) of less than 50%. Did the company meet this in 2013? Explain why Metro may have this objective.

  • CreatedJune 12, 2015
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