Question

Suppose you have been presented with the following selected information taken from the financial statements of Kellogg Company.



Instructions
(a) Calculate each of the following ratios for 2014 and 2013.
(1) Current ratio.
(2) Free cash flow.
(3) Debt to assets ratio.
(4) Times interest earned.
(b) Comment on the trend in ratios.
(c) Read the company’s note on leases. If the operating leases had instead been accounted for like a purchase, assets and liabilities would increase by approximately $584 mil-lion. Recalculate the debt to assets ratio for 2014 in light of this information, and discuss the implications foranalysis.


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  • CreatedApril 07, 2014
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