Exercise 10-19 Suppose McDonald\'s 2019 financial statements contain the followi

Question

Exercise 10-19 Suppose McDonald's 2019 financial statements contain the following selected data (in millions) Current assets Total assets Current liabilities Total liabilities $3,416.3 Interest expense 30,224.9 Income taxes $473.2 1,936.0 4,551.0 2,988.7 Net income 16,191.0 (al) Compute the following values. 1. Working capital 2. Current ratio. (Round to 2 decimal places, e.g. 6.25:1.) 3. Debt to assets ratio. (Round to 0 decimal places, e.g. 62%.) 4. Times interest earned. (Round to 2 decimal places, e.g. 6.25.) millions times

Explanation / Answer

Working Capital = Current Assets - Current liabilities 3416.3 - 2988.70 427.6 millions Current Ratio = Current Assets / Current liabilities 3416.3 / 2988.70 1.14 : 1 Debt To Assets Ratio = (Total Liabilities- Current Liabilities) / Total Assets (16191 - 2988.7) / 30224.9 43.68 % Times Interest Earned (Net Income + Income tax + Interest Expense) / Interest Expense (4551 + 1936 + 473.2) / 473.2 14.71 Times

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