Question: 1.) ADM-1 Continuing Company Analysis - Amazon : Working Capital and Current RatioAmazon.com , Inc. is the largest Internet retailer in the United States .

1.) ADM-1 Continuing Company Analysis - Amazon : Working Capital and Current RatioAmazon.com , Inc. is the largest Internet retailer in the United States . Best Buy , Inc . is aleading retailer of technology and media products in the United States . Amazon and Best Buycompete in similar markets ; however , Best Buy sells through both traditional retail stores andthe Internet , while Amazon sells only through the Internet . The current assets and currentliabilities from recent balance sheets for both companies are provided as infollows (in millions) :Current Assets $ 31, 327 $ 10, 485Current Liabilities 28, 089 7, 436A. Compute the working capital for each company .B. Which company has the largest working capital ?C. Is working capital a good measure of relative liquidity in comparing the two companies ?Explain .D. Compute the current ratio for both companies . ( round to one decimal place. )E. Which company has the larger relative liquidity based on the current ratio ?

2) ADM-1 Under Armour : Current RatioThe following year-end data were taken from recent balance sheets Of Under Armour , Inc. ( inmillions ) :Current Assets $ 1, 129 $ 903Current Liabilities 427 252A. Compute the working capital and the current ratio as of December 31, Year 2 and Year1. ( Round to one decimal place .)B. What conclusions concerning the company's ability to meet its short-term obligations canyou draw from part (A) ? 3.)Sears Holdings Corporation is one of the largest mall-based retailers in the United States . Thefollowing year-end data were taken from a recent Sears balance sheet ( in million ) :Current Assets $ 5, 863 $ 8, 959Current Liabilities 6, 076 8, 185A. Compute the working capital and the current ratio as of December 31, Year 1 and Year2. ( Round to two decimal places. )B. What conclusions concerning the company's ability to meet its short-term obligations canyou draw from part (A) ?

4.)ADM-4 Google and Microsoft : Current RatioGoogle , Inc. and Microsoft Corporation design and distribute consumer and enterprise software, including overlaps in search , business productivity , and mobile operating systems . Google'sprimary source of revenue is from advertising , while Microsoft's is fromSoftware subscriptionand support fees. The following you and data s ( in millions ) were taken from recent balancesheets for both companies :Microsoft GoogleYR1 YR2 YR1 YR2Current Assets $114,246 $101,466 $72,886 $80,685Current Liabilities 45,625 37,417 15,908 16,805B. Which company has the larger working capital at the end of Year 2 ?C. Is working capital a good measure of relative liquidity in comparing the two companies ?Explain .D. Compute the current ratio for both companies . ( Round to one decimal place . )E. Which company has the larger relative liquidity based on the current ratio ?F. Based on your analysis , comment on the short-term debt-paying ability of these twocompanies .

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!