Reference no: EM13789267
Sun Microsystems develops, manufactures, and sells computers for network systems. Exhibit 5.19 presents selected financial data for Sun Microsystems for each of the five years ending June 30, 2005, to June 30, 2009. The company did not go bankrupt, but instead was acquired in 2010 by Oracle. We recommend that you create an Excel spreadsheet to compute the values of the ratios and the Altman's Z-score in Parts a and b, respectively.
Required
a. Compute the value of each of the following risk ratios.
(1) Current Ratio (at the end of 2005-2009)
(2) Operating Cash Flow to Current Liabilities Ratio (for 2006-2009)
(3) Liabilities to Assets Ratio (at the end of 2005-2009)
(4) Long-Term Debt to Long-Term Capital Ratio (at the end of 2005-2009)
(5) Operating Cash Flow to Total Liabilities Ratio (for 2006-2009)
(6) Interest Coverage Ratio (for 2005-2009)
b. Compute the value of Altman's Z-score for Sun Microsystems for each year from 2005-2009.
c. Using the analyses in Parts a and b, discuss the most important factors that signal the likelihood of bankruptcy of Sun Microsystems in 2010.
|
Levels of total expenditures or total costs
: The dairy farm company, a small producer of milk and cheese, has estimated the quantities of milk and cheese that it can produce with three levels of total expenditures or total costs.
|
|
What is the divisions return on investment
: Heavey Fabrication is a division of a major corporation. Last year the division had total sales of $21,120,000, net operating income of $2,006,400, and average operating assets of $6,000,000. The company's minimum required rate of return is 12%. What..
|
|
Key component for knowledge management
: Business intelligence is a key component for knowledge management. Decision support systems (DSSes) are the foundation of business intelligence and add a modeling selection to user interface.
|
|
Schedule of expected cash collections
: Welnor Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow: Sales are budgeted at $320,000 for November, $340,000 for December, and $330,000 for January. Prepare a Schedul..
|
|
Compute the value of risk ratios
: Compute the value of each of the following risk ratios.
|
|
An appreciation of the nations currency leads
: A decrease in interests rats causes investment to increase. Explain - An appreciation of the nation's currency leads foreigners to demand less of the country's exports. Explain
|
|
Clinics revenue and spending variances
: lassey Clinic uses patient-visits as its measure of activity. The clinic bases its budgets on the following information: Revenue should be $41.80 per patient-visit. Personnel expenses should be $35,400 per month plus $10.60 per patient-visit. Prepare..
|
|
What are some of the elements of sarbanes-oxley
: From a practical perspective, what are some of the elements of Sarbanes-Oxley and Which of the following would be classified as tangible personal property, as opposed to other property categories, such as fixtures or intangible property
|
|
Social perceptions of the ethical fabric of entrepreneurs
: Social perceptions of the ethical fabric of entrepreneurs is typically mixed. While entrepreneurs are many times seen as individuals who will stop at nothing as long as they achieve their goals, they also have a reputation to keep in their communi..
|