Chapter 11
Financial Statement Analysis
583
b) Which company has stronger liquidity and leverage ratios? Which company would a bank
prefer to provide lending to based on the calculations in part a)?
AP-16B (
7
)
The following information is available for three different companies within the same industry.
Company A Company B Company C
Cash
$7,800
$7,020
$10,530
Short-Term Investments
2,000
1,800
4,700
Accounts Receivable
8,250
7,425
13,138
Prepaid Assets
1,500
1,350
3,025
Inventory
9,500
8,550
5,825
Total Assets
$29,050
$26,145
$37,218
Accounts Payable
$4,300
$4,515
$4,730
Deferred Revenue
7,500
7,875
8,250
Current Portion of Long-Term Debt
15,800
16,590
17,380
Total Liabilities
$27,600
$28,980
$30,360
