The following information was obtained from the fiscal year 2015 and 2014 financial statements included in Form
Question:
The following information was obtained from the fiscal year 2015 and 2014 financial statements included in Form 10-K of Kellogg Company and Subsidiaries and General Mills, Inc. and Subsidiaries. (Year-ends for Kellogg's are January 2, 2016, and January 3, 2015, and for General Mills are May 31, 2015, and May 25, 2014.) Assume all sales are on credit for both companies.
Required
1. Using the information provided, compute the following for each company for 2015:
a. Accounts receivable turnover ratio
b. Number of days' sales in receivables
c. Inventory turnover ratio
d. Number of days' sales in inventory
e. Cash-to-cash operating cycle
2. Comment briefly on the liquidity of each of these two companies.
Inventory Turnover RatioThe inventory turnover ratio is a ratio of cost of goods sold to its average inventory. It is measured in times with respect to the cost of goods sold in a year normally. Inventory Turnover Ratio FormulaWhere,... 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...
Step by Step Answer:
Using Financial Accounting Information The Alternative to Debits and Credits
ISBN: 978-1337491471
10th edition
Authors: Gary A. Porter, Curtis L. Norton