The financial statements for Shoppers Drug Mart Corporation are presented in Appendix C at the end of

Question:

The financial statements for Shoppers Drug Mart Corporation are presented in Appendix C at the end of the text.

Instructions

1. Determine the following measures for the fiscal years ended December 31, 2011, and January 1, 2011, rounding to one decimal place. Industry averages are provided in parentheses after each ratio.

a. Current ratio (1.35:1)

b. Quick ratio (0.65:1)

c. Accounts receivable turnover (13.6 times)

d. Inventory turnover (11.4 times)

e. Total asset turnover (1.9 times)

f. Debt ratio (48%)

g. Times interest earned ratio (6.6 times)

h. Profit margin (3.0%)

i. return on assets (5.7%)

j. Return on shareholders' equity (11.1%)

2. Compare the liquidity, efficiency, solvency, and profitability of Shoppers Drug Mart Corporation to the prior year and to the industry averages.

3. Assess whether Shoppers Drug Mart Corporation's financial situation is improving or declining from the prior year.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Asset Turnover
Asset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio. Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...