You are interested in further analyzing and comparing the liquidity of Covidien, PLC, and Johnson & John-son Company. In an earlier analysis in Appendix B of Chapter 6, you found the current ratios of both companies were above the threshold of 1 and similar at 2.22 for Covidien and 2.20 for Johnson & Johnson at the end of fiscal year 2013. In the Chapter 13 Financial Statement Analysis case, you assessed additional measures of­­Johnson & Johnson€™s liquidity, which are included below. Using information from the 2012 and 2013 financial statements for Covidien, answer the following questions about the company€™s liquidity and then compare the two companies.
a. Compute Covidien€™s quick ratio for each year.
b. Compute Covidien€™s cash ratio for each year.
c. Compute Covidien€™s defensive interval ratio for each year.
d. Comment on changes in Covidien€™s liquidity from 2012 to 2013 based on the ratios computed.
e. Compare the changes in Covidien€™s liquidity from 2012 to 2013 to those computed in Example 13.19 in the text for Johnson & Johnson. The tables below and on the following page are included for the comparison.

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Covidien PLC Fiscal year (in millions) Total assets Cash and cash equivalents Short-term marketable securities Accounts receivable Current assets Current liabilities 2012 $22,257 1,866 2013 $19,918 1,869 Percent Change (10.5%) 0.1% 0.0% (10.3%) (6.5%) (9.4%) 1.702 6,272 2,912 1,526 5,867 2,639 Covidien PLC Fiscal year (in millions) Cost of goods sold Sales, marketing and administrative expenses Research and development expense Depreciation and amortizatiorn Working capital Current ratio 2012 S3,944 3,686 623 633 3,.360 2.15 2013 S4,150 3,340 508 642 $3,228 2.22 Percent Change 5.2% (9.4%) (18.5%) 1.4% (3.9 %) 3.3% Johnson & Johnson Company (from Example 13.19 in text Percent Change 40.6% 15.8% 18.7% 31.0% 21.8% 2012 2013 Working capital Current ratio Quick or Acid Test Ratio Cash Ratio Defensive Interval Ratio $21.854$20 1.90 1.34 0.87 254.1 2.20 1.59 1.14 309.5