Saputo Inc. is a Montreal-based producer and distributor of dairy products, including cheese and yogurt products. According to the company’s website, it is “one of the top ten dairy processors in the world.” Exhibit 6.11A shows the company’s statement of financial position for the year ended March 31, 2017.

EXHIBIT 6.11A Saputo Inc.’s 2017 Consolidated Balance Sheets

The company’s revenues for the year ended March 31, 2017, were as shown in Exhibit 6.11B. 

EXHIBIT 6.11B Extract from Saputo Inc.’s 2017 Consolidated Statements of Earnings

Required

a. Calculate Saputo’s following ratios for both 2017 and 2016:

i. Current ratio 

ii. Quick ratio 

iii. Accounts receivable turnover (for this calculation, use the balance of accounts receivable at each year end, rather than average balances) 

iv. Average collection period

b. Comment on the results of the above ratio calculations and any signifi cant trends they reveal.

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Consolidated Balance Sheets (in millions of CDN dollars) March 31, March 31, 2017 As at 2016 ASSETS Current assets $ 250.5 $ 164.3 Cash and cash equivalents Receivables 863.2 837.5 Inventories (Note 4) 1,172.5 1,077.1 Income taxes receivable (Note 14) 4.7 15.0 Prepaid expenses and other assets 92.2 79.3 2,380.5 2,175.8 Property, plant and equipment (Note 6) 2,086.0 2,165.5 Goodwill (Note 7) 2,194.1 2,240.5 Intangible assets (Note 7) 662.3 587.0 Other assets (Note 8) 106.5 99.7 Deferred income taxes (Note 14) 22.9 48.1 Total assets $7,596.6 $7,172.3 LIABILITIES Current liabilities $ 178.2 Bank loans (Note 9) 93.8 Accounts payable and accrued liabilities 1,008.3 896.6 Income taxes payable (Note 14) 91.3 37.1 Current portion of long-term debt (Note 10) 244.9 1,193.4 1,356.8 Long-term debt (Note 10) 1,500.0 1,208.3 Other liabilities (Note 11) 68.9 61.8 Deferred income taxes (Note 14) 511.4 475.6 Total liabilities $3,273.7 $3,102.5 March 31, March 31, As at 2017 2016 EQUITY Share capital (Note 12) 871.1 821.0 Reserves 812.7 695.7 Retained earnings 2,639.1 2,485.1 Equity attributable to shareholders of Saputo Inc. 4,322.9 4,001.8 Non-controlling interest 68.0 Total equity $4,322.9 $4,069.8 Total liabilities and equity $7,596.6 $7,172.3