Solution-For each company compute these values and ratio

For each company compute these values and ratio current

Reference no: EM13480826

Selected financial data of two competitors, Blockbuster Inc. and Movie Gallery, Inc., in a recent year are presented below and on page 91. (All dollars are in millions.)

	Blockbuster Inc.	Movie Gallery, Inc.
	Income Statement Data for Year
Net sales	$ 5,524	$2,542
Cost of goods sold	2,476	1,012
Selling and administrative expenses	2,755	1,431
Interest expense	102	120
Other expense	212	3
Income tax expense (refund)	(76)	2
Net income (loss)	$ 55	$ (26)

	Blockbuster Inc.	Movie Gallery, Inc.
	Balance Sheet Data (End of Year)
Current assets	$ 1,566	$ 239
Property, plant, and equipment (net)	580	243
Intangible assets	835	297
Other assets	156	374
Total assets	$ 3,137	$1,153
Current liabilities	$ 1,395	$ 268
Long-term debt	851	1,122
Total stockholders' equity	891	(237)
Total liabilities and stockholders' equity	$ 3,137	$1,153
Cash from operating activities	$329	$(10)
Cash used for capital expenditures	79	20
Dividends paid	11	-0-
Average shares outstanding	189.0	31.8

Instructions

For each company, compute these values and ratios.

(a) Working capital.

(b) Current ratio. (Round to two decimal places.)

(d) Free cash flow.

(e) Earnings per share.

(f ) Compare the liquidity, profitability, and solvency of the two companies.

Reference no: EM13480826

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For each company compute these values and ratio current

Reference no: EM13480826

Reference no: EM13480826

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