The food manufacturing and distribution business is very competitive. Below you can find the condensed financial...

 

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The food manufacturing and distribution business is very competitive. Below you can find the condensed financial statements of 2 companies, Sysco & Merz Corporation (aka Merz) and United Natural Foods & Schueler (aka Schueler), that operate in the food manufacturing and distribution industry ($ in millions, except per share amounts). Balance Sheets Assets Cash Accounts receivable (net) Short-term investments Inventory Prepaid expenses and other current assets Current assets Property, plant, and equipment (niet) Intangibles and other assets Total assets Liabilities and Shareholders' Equity Accounts payable Short-term notes Accruals and other current liabilities Current liabilities Long-term debt Deferred tax liability Other long-term liabilities Total liabilities Common stock (par and additional paid-in capital) Retained earnings Less: Treasury stock Total liabilities and shareholders' equity Income Statements Net sales Cost of goods sold Gross profit Operating expenses Interest expense Incone before taxes Income tax expense Net income Net income per share Sysco & Merz Corporation $ 232.3 465.7 510.4 172.6 1,381.0 2,656.2 256.3 $ 4,293.5 $ 530.9 271,1 639.2 1,441.2 594.6 433.6 163.0 2,632.4 195,9 2,526.9 (1,061.7) $ 4,293.5 $ 5,751.0 (2,861.0) 2,890.0 (1,692.7) (55.8) 1,141.5 (339.7) $ 801.8 $4.0 United Natural Foods & Schueler $ 42.0 365.0 7.4 673.2 533.7 1,621.3 2,348.3 528.6 $ 4,498.1 $ 743.2 600,4 583.5 1,927.1 593.3 658.7 150.1 3,329.2 382.0 1,653.9 (867.0) $4,498.1 $7,814.2 (4,429.7) 3,384.5 (2,484.2) (46.6) 853.7 (232.1) $ 621.6 $.8.2 Evaluate and compare the two companies by responding to the following questions. Note: Because comparative statements are not provided, you should use year-end balances in place of average balances as appropriate. Required: 1. For both companies, compute the ratios below. 2. Evaluate and compare the two companies. Return on Assets Profit Margin Asset Turnover Return on Equity Equity Multiplier Acid-Test Ratio Current Ratio Receivables Turnover Inventory Turnover Times Interest Earned Merz 0.19 % % times % times times times Schueler 0.13 % % times % times times times The food manufacturing and distribution business is very competitive. Below you can find the condensed financial statements of 2 companies, Sysco & Merz Corporation (aka Merz) and United Natural Foods & Schueler (aka Schueler), that operate in the food manufacturing and distribution industry ($ in millions, except per share amounts). Balance Sheets Assets Cash Accounts receivable (net) Short-term investments Inventory Prepaid expenses and other current assets Current assets Property, plant, and equipment (niet) Intangibles and other assets Total assets Liabilities and Shareholders' Equity Accounts payable Short-term notes Accruals and other current liabilities Current liabilities Long-term debt Deferred tax liability Other long-term liabilities Total liabilities Common stock (par and additional paid-in capital) Retained earnings Less: Treasury stock Total liabilities and shareholders' equity Income Statements Net sales Cost of goods sold Gross profit Operating expenses Interest expense Incone before taxes Income tax expense Net income Net income per share Sysco & Merz Corporation $ 232.3 465.7 510.4 172.6 1,381.0 2,656.2 256.3 $ 4,293.5 $ 530.9 271,1 639.2 1,441.2 594.6 433.6 163.0 2,632.4 195,9 2,526.9 (1,061.7) $ 4,293.5 $ 5,751.0 (2,861.0) 2,890.0 (1,692.7) (55.8) 1,141.5 (339.7) $ 801.8 $4.0 United Natural Foods & Schueler $ 42.0 365.0 7.4 673.2 533.7 1,621.3 2,348.3 528.6 $ 4,498.1 $ 743.2 600,4 583.5 1,927.1 593.3 658.7 150.1 3,329.2 382.0 1,653.9 (867.0) $4,498.1 $7,814.2 (4,429.7) 3,384.5 (2,484.2) (46.6) 853.7 (232.1) $ 621.6 $.8.2 Evaluate and compare the two companies by responding to the following questions. Note: Because comparative statements are not provided, you should use year-end balances in place of average balances as appropriate. Required: 1. For both companies, compute the ratios below. 2. Evaluate and compare the two companies. Return on Assets Profit Margin Asset Turnover Return on Equity Equity Multiplier Acid-Test Ratio Current Ratio Receivables Turnover Inventory Turnover Times Interest Earned Merz 0.19 % % times % times times times Schueler 0.13 % % times % times times times

Answer rating: 100% (QA)

Ratio Merz Schueler Return on Assets 19 11 Profit Margin 19 11 Asset Turnover 1 times 1 times Return on Equity 48 54 Equity Multiplier 259 times 504 times AcidTest Ratio 138 times 168 times Current Ra... View the full answer