Eat at my restaurant-liquidity review

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Reference no: EM131004101

Eat at my restaurant - liquidity review

With this case, we review the liquidity of several restaurant companies. The restaurant com- panies reviewed and the year-end dates are as follows:

1. Yum Brands, Inc. (December 30, 2006; December 30, 2005)

"Yum consists of six operating segments; KFC, Pizza Hut, Taco Bell, LJS/A&W, Yum Restaurants International . . . and YUM Restaurants China." 10-K

2. Panera Bread (December 26, 2006; December 27, 2005)

"As of December 26, 2006 we operated directly and through area development agree- ments with 41 franchise groups, bakery cafes under Panera Bread® and Saint Louis Bread® names." 10-K

3. Starbucks (October 1, 2006; October 2, 2005)

"Starbucks purchases and roasts high-quality whole bean coffees and sells them, along with fresh, rich-brewed coffees, Italian-style espresso beverages, cold blended beverages, a variety of complementary food items, coffee-related accessories and equipment, a selection of premium teas and a line of compact discs, primarily through Company-operated retail stores." 10-K

Yum Brands, Inc. Panera Bread Starbucks

DataReviewed	2006	2005	2006	2005	2006	2005
Current ratio	0.52	0.53	1.16	1.18	0.79	0.99
Acid test	0.32	0.27	0.83	0.91	0.35	0.41

Required:

a. For each company, indicate the trend in liquidity.

b. Give your opinion as to the relative liquidity of each of these companies. How would you rank these companies?

Reference no: EM131004101

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