Cabela€™s Incorporated (CAB) is a leading specialty retailer of outdoor sports merchandise. Dick€™s Sporting Goods, Inc. (DKS) is a leading full-line retailer of sporting equipment and apparel. The current assets and current liabilities of both companies are provided as follows from recent financial statements (in millions):

Cabela€™s has a branded credit card that is the basis for its financial services business. €œCredit card loans€ in Cabela€™s current assets represent the amounts due from Cabela€™s CLUB® Visa credit card customers. The credit card loans represent 2,064,517 active accounts with an average balance of $2,480. The credit card holders have a median FICO score of 793, which denotes highly creditworthy customers. Cabela€™s other current liabilities include, among other items, short-term funding to support credit card purchases from its CLUB members.

a. What do the €œgift cards€ listed under Cabela€™s current liabilities represent?

b. Should the €œcredit card loans€ be considered part of quick assets for Cabela€™s computation of the quick ratio? Explain.
c. Compute the current ratio for Cabela€™s and Dick€™s Sporting Goods. Round to one decimal place.
d. Compute the quick ratio for Cabela€™s and Dick€™s Sporting Goods. Round to one decimal place.

e. Compare the two companies using the computations in (c) and (d).

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Cabela's Dick's Current assets: $ 313 Cash Accounts receivable. $ 165 76 75 Credit card loans. 5,580 Inventories... 860 1,639 Other current assets . 208 117 Total current assets. $1,996 $7,037 Current liabilities: $ 348 $ 756 Accounts payable.. Gift cards... 388 Other current liabilities 1,954 641 Total current liabilities. $2,690 $1,397