ACC 498
Assignment 2

Chapter 2 Activity 16

Q1. (b) $58,145 (Y) $18,405 Debt ratio- Google 19.9% GIS 150% Based on this information, I would choose to invest in Google over General Mills. I would choose to invest in Google because they are using more equity for financing instead of credit. Equity provides less financial risk and is an asset the company already owns instead of generating more debt for the company.

Q2. A.) does, does not B.) must, never has to C.) reduces, do not reduce D.) does not, does E.) equity.

E. My recommendation for financing assets would be to use equity because financing with credit creates a larger financial risk for the company.

Chapter 2 Activity 20

YUM! BRANDS (YUM) Classified Balance Sheet/ Common-Size Statements ($ in millions) | | 12/25/10 | 12/26/09 | 12/27/08 | 12/29/07 | | $ | CS% | $ | CS% | $ | CS% | $ | CS% | Current Assets | 2,313 | 27.8% | 1,208 | 16.9% | 951 | 14.6% | 1,481 | 20.6% | PPE, Net | 3,830 | 46.1% | 3,899 | 54.5% | 3,710 | 56.8% | 3,849 | 53.5% | Goodwill + Intang. | 1,134 | 13.6% | 1,102 | 15.4% | 940 | 14.4% | 1,026 | 14.3% | Other assets | 1,039 | 12.5% | 939 | 13.1% | 926 | 14.2% | 832 | 11.6% | Total Assets | 8,316 | 100.0% | 7,148 | 100.0% | 6,527 | 100.0% | 7,188 | 100.0% | C liabilities | 2,448 | 29.4% | 1,653 | 23.1% | 1,722 | 26.4% | 2,062 | 28.7% | NC liabilities | 4,292 | 51.6% | 4,470 | 62.5% | 4,913 | 75.3% | 3,987 | 55.5% | Total Liab | 6,740 | 81.0% | 6,123 | 85.7% | 6,635 | 101.7% | 6,049 | 84.2% | Ccapital | 86 | 1.0% | 253 | 3.5% | 7 | 0.1% | 0 | 0.0% | Rearnigs | 1,717 | 20.6% | 996 | 13.9% | 303 | 4.6% | 1,119 | 15.6% | Other SE | -227 | -2.7% | -224 | -3.1% | -418 | -6.4% | 20 | 0.3% | Total SE | 1,576 | 19.0% | 1,025 | 14.3% | -108 | -1.7% |