Amazon.com, Inc.'s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented

Question:

Amazon.com, Inc.'s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. The complete annual reports of Amazon and Wal-Mart, including the notes to the financial statements, are available at each company's respective website.

Instructions
a. At December 31, 2015, what was Amazon's largest current liability account? What were its total current liabilities? At January 31, 2016, what was Wal-Mart's largest current liability account? What were its total current liabilities?

b. Based on information in these financial statements, compute the following 2015 values for Amazon and 2016 values for Wal-Mart:

1. Working capital.
2. Current ratio.
c. What conclusions concerning the relative liquidity of these companies can be drawn from these data?

d. Based on the information contained in these financial statements, compute the following 2015 ratios for Amazon and 2016 ratios for Wal-Mart.

1. Debt to assets.

2. Times interest earned.

e. What conclusions concerning the companies' long-run solvency can be drawn from these ratios?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Solvency
Solvency means the ability of a business to fulfill its non-current financial liabilities. Often you have heard that the company X went insolvent, this means that the company X is no longer able to settle its noncurrent financial...

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