Question

The Fancy Cola Company reported the following comparative information at December 31, 2014, and December 31, 2013 (amounts in millions and adapted):


Requirements
1. Calculate the following ratios for 2014 and 2013:
a. Current ratio
b. Debt ratio
2. During 2014, the Fancy Cola Company issued $1,590 million of long-term debt that was used to retire short-term debt. What would the current ratio and debt ratio have been if this transaction had not been made?
3. The Fancy Cola Company reports that its lease payments under operating leases will total $965 million in the future and $205 million will occur in the next year (2015). What would the current ratio and debt ratio have been in 2014 if these leases had beencapitalized?


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  • CreatedJuly 25, 2014
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