Question: Selected financial data for two intense competitors in a recent year follow (amounts in millions): Sandhill Corporation Wildhorse Company begin{tabular}{|c|c|c|} hline multicolumn{3}{|l|}{ Statement of income


Selected financial data for two intense competitors in a recent year follow (amounts in millions): Sandhill Corporation Wildhorse Company \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|l|}{ Statement of income data: } \\ \hline Net sales & $3,339 & $6,772 \\ \hline Cost of goods sold & 2,991 & 5,753 \\ \hline Selling and administrative expenses & 88 & 412 \\ \hline Interest expense & 140 & 188 \\ \hline Other expenses & 8 & 0 \\ \hline Income taxes & 56 & 107 \\ \hline Net income & $56 & $312 \\ \hline \multicolumn{3}{|l|}{ Statement of cash flows data: } \\ \hline Net cash inflow from operating activities & $122 & $239 \\ \hline Net increase in cash during the year & 10 & 37 \\ \hline \multicolumn{3}{|l|}{ Statement of financial position data: } \\ \hline \multicolumn{3}{|l|}{ End-of-year balances: } \\ \hline Current assets & $1,012 & $1,636 \\ \hline Property, plant, and equipment (net) & 1,867 & 2,945 \\ \hline Other assets & 715 & 1,030 \\ \hline Total assets & $3,594 & $5,611 \\ \hline Current liabilities & $584 & $821 \\ \hline Long-term debt & 2,215 & 3,107 \\ \hline Total shareholders' equity & 795 & 1,683 \\ \hline Total liabilities and shareholders' equity & $3,594 & $5,611 \\ \hline \multicolumn{3}{|l|}{ Beginning-of-year balances: } \\ \hline Total assets & $3,250 & $5,196 \\ \hline Total shareholders' equity & 747 & 1,242 \\ \hline \multicolumn{3}{|l|}{ Other data: } \\ \hline Average net receivables & $345 & $787 \\ \hline Average inventory & 286 & 570 \\ \hline \end{tabular} (a) For each company, calculate the following ratios: (Round accounts receivable turnover, inventory turnover and current ratio to 2 decimal places, e.g. 14.83. Round net debt as a percentage of total capitalization to 2 decimal places, e.g. 0.83. Round average collection period, days to sell inventory, operating cash flow ratio, interest coverage, return on asset and return on equity to 1 decimal place, e.g. 14.8 or 13.5%.)
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
