omparing Firms Using Ratio Analysis

Consider the following data for several pharmaceutical firms $($$ millions$).($None of the firms reported the proceeds from disposals of property, plant, and equipment.$)$

Average Cash from Expenditures

Current Liabilities Operations on PPE

Medic & Co$.$ $$47,893$ $$18,455$ $$8,431$

Pharma Inc. $60,20225,9254,054$

Avett Labs $23,79314,2223,919$

Larson & Larson $73,91242,3656,025$

a$.$ Compute the operating cash flow to current liabilities $($OCFCL$)$ ratio for each firm.

Company Numerator $-$: Denominator $=$ Result

Medic & Co$.$ Answer $1$

$0$

$-$: Answer $2$

$0$

$=$

Pharma Inc. Answer $3$

$0$

$-$: Answer $4$

$0$

$=$

Avett Labs Answer $5$

$0$

$-$: Answer $6$

$0$

$=$

Larson & Larson Answer $7$

$0$

$-$: Answer $8$

$0$

$=$

b$.$ Compute the free cash flow for each firm.

Company $?-?=$ Result

Medic & Co$.$ Answer $9$

$0$

$-$ Answer $10$

$0$

$=$

$0$

Pharma Inc. Answer $11$

$0$

$-$ Answer $12$

$0$

$=$

$0$

Avett Labs Answer $13$

$0$

$-$ Answer $14$

$0$

$=$

$0$

Larson & Larson Answer $15$

$0$

$-$ Answer $16$

$0$

$=$

$0$

c$.$ Comment on the results of your computations.

Answer $17$

of the firms have sufficient cash flow to cover their current liabilities. All of the companies have Answer $18$

free cash flow that could be invested or returned to shareholders in the form of dividends or stock repurchases.

Please answer all parts of the question.