Case 4.1 (P.330) a. Exhibit 4.44 presents profitability ratios for Starbucks for

Question

Case 4.1 (P.330) a. Exhibit 4.44 presents profitability ratios for Starbucks for fiscals 2006 and 2007. Using the financial statement data in exhibit 1.26 and 1.27, compute the values of these ratios for fiscal 2008. The income tax rate is 35 percent. For accounts receivable turnover, use only specialty revenues for the numerator, because the accounts receivable are primarily related to licensing and food service operations, not the retail operations. Use cost of sales, including occupancy costs, for the numerator of the inventory turnover because Starbucks does not disclose separately the cost of products sold (the appropriate numerator) and occupancy costs.

Explanation / Answer

http://www.solutioninn.com/business/finance/risk-analysis/exhibit-526-presents-risk-ratios-for-starbucks-for-2006-and

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