Ratio Analysis Compute the ratios below for Blue Bill Corporation based on the financial statements provided. Ending inventory was $1,237.6 for year 2010. After calculating the various ratios, analyze the overall financial health of Blue Bill Corporation. Values presented on the financial statements are in millions.
| Blue Bill Corporation |
| Balance Sheet |
| December 31, 2011 |
| Assets |
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Liabilities and Shareholders' Equity |
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| Current Assets |
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Current liabilities |
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| Cash and cash equivalents |
$ 483.2 |
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Short-term debt |
$ 43.4 |
| Receivables (net of allowance) |
1,045.1 |
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Long-term debt due within a year |
151.6 |
| Inventories |
1,249.4 |
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Accounts payable |
1,007.7 |
| Other current assets |
273.5 |
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Other accrued liabilities |
972.7 |
| Total current assets |
3,051.2 |
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Total current liabilities |
2,175.4 |
| Property, plan and equipment |
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| Land |
77.1 |
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Long-term liabilities |
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| Buildings |
842.4 |
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Long-term debt |
4,559.4 |
| Equipment |
3,546.0 |
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Deferred taxes |
665.3 |
| Less accumulated depreciation |
2,373.7 |
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Other long-term liabilities |
784.2 |
| Total property, plant and equipment |
2,091.8 |
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Total long-term liabilities |
6,008.9 |
| Other noncurrent assets |
4,932.6 |
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Shareholders' equity |
1,891.3 |
| Total assets |
$10,075.6 |
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Total liabilities and shareholders' equity |
$10,075.6 |
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| Blue Bill Corporation |
| Income Statement |
| 2011 |
| Sales |
$10,495.0 |
| Cost of products sold |
6,700.5 |
| Gross Profit |
3,794.5 |
| Selling and administrative expense |
2,350.9 |
| Operating income |
1,443.6 |
| Other income |
(18.3) |
| Earnings before interest and taxes |
1,425.3 |
| Interest expense |
295.2 |
| Taxes |
247.8 |
| Net income |
$ 882.3 |
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| Ratio analysis |
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| Liquidity ratios: |
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| Current ratio |
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| Quick ratio |
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| Activity ratios: |
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| Inventory turnover |
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| Receivables turnover |
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| Days sales outstanding |
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| Fixed asset turnover |
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| Profitability ratios: |
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| Gross profit margin |
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| Operating profit margin |
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| Net profit margin |
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| Return on assets |
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| Return on equity |
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| Leverage ratios: |
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| Debt / Net worth |
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| Debt ratio |
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| Coverage ratios: |
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| Times-interest-earned |
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