BTN$9-2.$ Comparative Analysis Problem: Columbia Sportswear Company vs Under Armour Inc.

The financial statements for the Columbia Sportswear Company can be found in Appendix A$,$ and the financial statements of Under Armour, Inc., can be found in Appendix B$.$

Required

Answer the following questions:

a$.$ Compute the current ratio for Columbia Sportswear and Under Armour, Inc., as of December $31,2020,$ and comment on what this ratio implies about each company's liquidity and working capital position.

b$.$ Compute the debt$-$to$-$total assets ratio for Columbia Sportswear and Under Armour, Inc., as of December $31,2020,$ and comment on what this ratio implies about each company's solvency.COLUMBIA SPORTSWEAR COMPANY

CONSOLIDATED BALANCE SHEETS

December $31,$

$($in thousands$)$

ASSETS

Current Assets:

Cash and cash equivalents

Short$-$term investments

Accounts receivable, net of allowance of $$21,810$ and $$8,925,$ respectively

Inventories, net

Prepaid expenses and other current assets

Total current assets

Property, plant and equipment, net

Operating lease right$-$of$-$use assets

Intangible assets, net

Goodwill

Deferred income taxes

Other non$-$current assets

Total assets

LIABILITIES AND EQUITY

Current Liabilities:

$\backslash$table$[[$Accounts payable,$$,206,697,$$$,255,372],[$Accrued liabilities,,$257,278,,295,723],[$Operating lease liabilities,,$65,466,,64,019],[$Income taxes payable,,$23,181,,15,801],[$Total current liabilities,,$552,622,,630,915],[$Non$-$current operating lease liabilities,,$353,181,,371,507],[$Income taxes payable,,$49,922,,48,427],[$Deferred income taxes,,$5,205,,6,361],[$Other long$-$term liabilities,,$42,870,,24,934],[$Total liabilities,,$1,003,800,,1,082,144],[$Commitments and contingencies $($Note $12),,,,],[$Shareholders$\text{'}$ Equity.,,,,$],[$Preferred slock; $10,000$ shares authorized; none issued and outstanding,,$-,,-],[$Common stock $($no par value$)$; $250,000$ shares authorized; $66,252$ and $67,561$ issued and outstanding, respectively,,$20,165,,4,937],[$Retained earnings,,$1,811,800,,1,848,935],[$Accumulated other comprehensive income $($loss$),,806,,(4,425)],[$Total shareholders' equity,,$1,832,771,,1,849,447],[$Total liabilities and shareholders' equity,$$,2\mathrm{.}836,571,$$$,2,931,591]]$