Question

Using the following data, financial ratios need to be determined for the calculations at the bottom.

STARBUCKS CORP
CONSOLIDATED BALANCE SHEETS (HORIZONTAL ANALYSIS)
	Oct 1,		Oct 2,		Sep 27,	% Change	% Change
	2017		2016		2015	2017-2016	2016-2015
ASSETS
Current assets:
Cash and cash equivalents	$    2,462.30		$    2,128.80		$    1,530.10	15.67%	39.13%
Short-term investments	228.60		134.40		81.30	70.09%	65.31%
Accounts receivable, net	870.40		768.80		719.00	13.22%	6.93%
Inventories	1,364.00		1,378.50		1,306.40	-1.05%	5.52%
Prepaid expenses and other current assets	358.10		347.40		334.20	3.08%	3.95%
Total current assets	5,283.40		4,757.90		3,971.00	11.04%	19.82%
Long-term investments	542.30		1,141.70		312.50	-52.50%	265.34%
Equity and cost investments	481.60		354.50		352.00	35.85%	0.71%
Property, plant and equipment, net	4,919.50		4,533.80		4,088.30	8.51%	10.90%
Deferred income taxes, net	795.40		885.40		1,180.80	-10.16%	-25.02%
Other long-term assets	362.80		403.30		415.90	-10.04%	-3.03%
Other intangible assets	441.40		516.30		520.40	-14.51%	-0.79%
Goodwill	1,539.20		1,719.60		1,575.40	-10.49%	9.15%
TOTAL ASSETS	$ 14,365.60		$ 14,312.50		$ 12,416.30	0.37%	15.27%
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$       782.50		$       730.60		$       684.20	7.10%	6.78%
Accrued liabilities	1,934.50		1,999.10		1,755.30	-3.23%	13.89%
Insurance reserves	215.20		246.00		224.80	-12.52%	9.43%
Stored value card liability	1,288.50		1,171.20		983.80	10.02%	19.05%
Current portion of long-term debt	-		399.90		-	400.00%	0.00%
Total current liabilities	4,220.70		4,546.80		3,648.10	-7.17%	24.63%
Long-term debt	3,932.60		3,185.30		2,347.50	23.46%
Other long-term liabilities	755.30		689.70		600.90	9.51%	14.78%
Total liabilities	8,908.60		8,421.80		6,596.50	5.78%	27.67%
Shareholders equity:
Common stock ($0.001 par value) authorized,	1.40		1.50		1.50	-6.67%	0.00%
2,400.0 shares; issued and outstanding,
1,485.1 and 1,499.1 shares, respectively
Additional paid-in capital	41.10		41.10		41.10	0.00%	0.00%
Retained earnings	5,563.20		5,949.80		5,974.80	-6.50%	-0.42%
Accumulated other comprehensive income/(loss)	(155.60)		(108.40)		(199.40)	43.54%	-45.64%
Total shareholders equity	5,450.10		5,884.00		5,818.00	-7.37%	1.13%
Noncontrolling interest	6.90		6.70		1.80	2.99%	272.22%
Total equity	5,457.00		5,890.70		5,819.80	-7.36%	1.22%
TOTAL LIABILITIES AND EQUITY	$ 14,365.60		$ 14,312.50		$ 12,416.30	0.37%	15.27%

STARBUCKS CORP
CONSOLIDATED STATEMENTS OF EARNINGS (HORIZONTAL ANALYSIS)
		Oct 1,		Oct 2,		Sep 27,		% Change	% Change
		2017		2016		2015		2017-2016	2016-2015
Net revenues:
Company-operated stores		$17,650.70		$ 16,844.10		$ 15,197.30		4.79%	10.84%
Licensed stores		2,355.00		2,154.20		1,861.90		9.32%	15.70%
CPG, foodservice and other		2,381.10		2,317.60		2,103.50		2.74%	10.18%
Total net revenues		22,386.80		21,315.90		19,162.70		5.02%	11.24%
Cost of sales including occupancy costs		9,038.20		8,511.10		7,787.50		6.19%	9.29%
Store operating expenses		6,493.30		6,064.30		5,411.10		7.07%	12.07%
Other operating expenses		553.80		545.40		522.40		1.54%	4.40%
Depreciation and amortization expenses		1,011.40		980.80		893.90		3.12%	9.72%
General and administrative expenses		1,393.30		1,360.60		1,196.70		2.40%	13.70%
Restructuring and impairments		153.50		-		-		0.00%	#DIV/0!
Total operating expenses		18,643.50		17,462.20		15,811.60		6.76%	10.44%
Income from equity investees		391.40		318.20		249.90		23.00%	27.33%
Operating income/(loss)		4,134.70		4,171.90		3,601.00		-0.89%	15.85%
Gain resulting from acquisition of joint venture		-		-		390.60		0.00%	0.00%
Loss on extinguishment of debt		-		-		(61.10)		0.00%	0.00%
Interest income and other, net		275.30		108.00		43.00		154.91%	151.16%
Interest expense		(92.50)		(81.30)		(70.50)		13.78%	15.32%
Earnings/(loss) before income taxes		4,317.50		4,198.60		3,903.00		2.83%	7.57%
Income tax expense/(benefit)		1,432.60		1,379.70		1,143.70		3.83%	20.63%
Net earnings including noncontrolling interests		2,884.90		2,818.90		2,759.30		2.34%	2.16%
Net earnings/(loss) attributable to noncontrolling interests		0.20		1.20		1.90		-83.33%	-36.84%
Net earnings attributable to Starbucks		$ 2,884.70		$ 2,817.70		$ 2,757.40		2.38%	2.19%
Earnings per share basic		1.99		1.91		1.84		4.19%	3.80%
Earnings per share diluted		1.97		1.90		1.82		3.68%	4.40%
Weighted average shares outstanding:
Basic		1,449.50		1,471.60		1,495.90		-1.50%	-1.62%
Diluted		1,461.50		1,486.70		1,513.40		-1.70%	-1.76%

KEY FINANCIAL STATEMENT RATIOS

THIS YEAR (FY17)

LAST YEAR (FY16)

Industry

Amounts

Answer

Amounts

Answer

Average

Liquidity ratios

Current Ratio

Current Assets/

=

=

=

Current Liabilities

Quick Ratio, or

Quick Assets */

"Acid Test"

Current Liabilities

* Quick assets include Cash, Marketable Securities, and Accounts Receivable (excludes Inventory)

Asset Management Ratios

Inventory

Cost of Goods Sold/

Turnover

Inventory*

Accts Receivable

Sales/

Turnover

Accts Receivable*

* Textbooks generally use "average" for the year (beginning + ending) / 2, but it's OK to use ending only

Debt (Leverage) (Long-term Solvency) Ratios

Debt to

Total Liabilities/

Assets

Total Assets

Debt to

Total Liabilities/

Equity

Total Equity

Times interest

EBIT*/

Earned

Interest expense

* EBIT means "Earnings before Interest and Taxes"

Profitability Ratios (not applicable if net loss)

Net Profit

Net Income/

Margin (%)

Sales

Gross Profit

Gross Profit/

on Sales (%)

Sales

Return

Net Operating Income/

on Assets (%)

Total Operating Assets

aka ROI

Return

Net Income/

on Equity (%)

Total Equity

Market Value Ratios

Earnings per

Net Income/

Industry avg.

Share (EPS)

No. shares outstanding

not relevant

Price/Earnings*

Market Price/

prior year not required

Ratio (P/E)

EPS

* P/E ratio changes daily with market price. If EPS is negative, ratio is "not applicable". Use "Basic" , not "Diluted".

Answer 1