a. Assess the changes in the short-term liquidity risk of Coca-Cola between Year 1 and Year...

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a. Assess the changes in the short-term liquidity risk of Coca-Cola between Year 1 and Year 3. b. Assess the changes in the long-term solvency risk of Coca-Cola between Year 1 and Year 3. Exhibit 5.16 Risk Ratios for Coca-Cola (Problem 5.15) I Year 3 Year 2 Year 1 Current ratio 0.9 60 0.9 0.9 Quick ratio 0.6 0.6 0.6 Operating cash flow to current liabilities ratio 0.578 0.647 0.636 Days accounts receivable outstanding 37 37 37 Days inventory held 71 68 68 Days accounts payable outstanding 44 38 40 Net days of working capital financing needed 64 67 65 Liabilities to assets ratio 0.495 0.497 0.435 Liabilities to shareholders' equity ratio 0.979 0.990 0.771 Long-term debt to long-term capital ratio 0.120 0.131 0.072 Long-term debt to shareholders' equity ratio 0.136 0.151 0.078 Operating cash flow to average total liabilities ratio Interest coverage ratio 0.364 0.414 0.456 17.0 17.3 29.9 a. Assess the changes in the short-term liquidity risk of Coca-Cola between Year 1 and Year 3. b. Assess the changes in the long-term solvency risk of Coca-Cola between Year 1 and Year 3. Exhibit 5.16 Risk Ratios for Coca-Cola (Problem 5.15) I Year 3 Year 2 Year 1 Current ratio 0.9 60 0.9 0.9 Quick ratio 0.6 0.6 0.6 Operating cash flow to current liabilities ratio 0.578 0.647 0.636 Days accounts receivable outstanding 37 37 37 Days inventory held 71 68 68 Days accounts payable outstanding 44 38 40 Net days of working capital financing needed 64 67 65 Liabilities to assets ratio 0.495 0.497 0.435 Liabilities to shareholders' equity ratio 0.979 0.990 0.771 Long-term debt to long-term capital ratio 0.120 0.131 0.072 Long-term debt to shareholders' equity ratio 0.136 0.151 0.078 Operating cash flow to average total liabilities ratio Interest coverage ratio 0.364 0.414 0.456 17.0 17.3 29.9