Question

The financial statements of Shoppers Drug Mart Corporation for the year ended December 31, 2011 appear in Appendix 5B.
Instructions
(a) What alternative formats could the company have used for its balance sheet? Which format did it adopt?
(b) Identify the various techniques of disclosure that the company could have used to disclose additional financial information that is pertinent. Which techniques does it use in its financials?
(c) Which presentation method does the company use for its statement of cash flows (direct or indirect method)? What were the company's cash flows from its operating, investing, and financing activities for the year ended December 31, 2011? What were its trends in net cash provided by operating activities for the periods ended December 31, 2010, and 2011? Is the cash generated from operating activities significantly different from net earnings in both periods? Suggest why this might happen.
(d) Calculate the company's (1) current cash debt coverage ratio, (2) cash debt coverage ratio, and (3) free cash flow for the years ended December 31, 2011, and January 1, 2011. What do these ratios indicate about the company's financial condition?


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  • CreatedSeptember 18, 2015
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