Analyzing the Kroger Company and Whole Foods Market The following information relates to The Kroger Company and

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Analyzing the Kroger Company and Whole Foods Market The following information relates to The Kroger Company and Whole Foods Market, Inc. for their 2009 and 2008 fiscal years.

THE KROGER COMPANY Selected Financial Information (Amounts in millions, except per share amounts) January 31, 2009 Febru

Required
a. Compute the following ratios for the companies€™ 2009 fiscal years:
(1) Current ratio.
(2) Average days to sell inventory. (Use average inventory.)
(3) Debt to assets ratio.
(4) Return on investment. (Use average assets and use €œearnings from continuing operations€ rather than €œnet earnings.€)
(5) Gross margin percentage.
(6) Asset turnover. (Use average assets.)
(7) Return on sales. (Use €œearnings from continuing operations€ rather than €œnet earnings.€)
(8) Plant assets to long-term debt ratio.
b. Which company appears to be more profitable? Explain your answer and identify which of the ratio(s) from Requirement a you used to reach your conclusion.
c. Which company appears to have the higher level of financial risk? Explain your answer and identify which of the ratio(s) from Requirement a you used to reach your conclusion.
d. Which company appears to be charging higher prices for its goods? Explain your answer and identify which of the ratio(s) from Requirement a you used to reach your conclusion.
e. Which company appears to be the more efficient at using its assets? Explain your answer and identify which of the ratio(s) from Requirement α you used to reach your conclusion.

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