# Refer to the financial information at the back of the book for Panera Bread and Chipotle. Required

## Question:

Refer to the financial information at the back of the book for Panera Bread and Chipotle.

**Required**

Part A. The Ratio Analysis Model

For each company, determine:

The debt-to-equity ratio

Is the debt-to-equity ratio of either company too high?Have the companies effectively used leverage? Replicate the five steps in the Ratio Analysis Model on pages 474–475 to perform the analysis.

1. Formulate the Question

2. Gather the Information from the Financial Statements

3. Calculate the Ratio

4. Compare the Ratio with Other Ratios

5. Interpret the Ratios

**Part B. The Business Decision Model**

If you were an investor, would you be willing to lend money to either or both companies based on their use of debt?

1. Formulate the Question

2. Gather Information from the Financial Statements and Other Sources

3. Analyze the Information Gathered

4. Make the Decision

5. Monitor Your Decision

**Five Steps From Analysis Model:**

1. Formulate the Question

2. Gather the Information from the Financial Statements

3. Calculate the Ratios for PepsiCo, Inc.

4. Compare the Ratio with Others

5. Interpret the Results

## Step by Step Answer:

**Related Book For**

## Using Financial Accounting Information The Alternative to Debits and Credits

**ISBN:** 978-1337491471

10th edition

**Authors:** Gary A. Porter, Curtis L. Norton