Team instructions: Provide students with copies of real merchandising companies' annual reports, or give students the Web addresses of real merchandising companies and ask them to print out the annual reports
Divide the class into teams of three or four people. All team members should work with the same company's annual report. Give the students time in class to answer the following questions for their company. Each team should turn in only one copy of the answers for grading, along with a copy of the annual report that they used. All team members will receive the same grade.
1. What is the name of your company?
2. Calculate the debt-to-equity ratio for the most recent year.
3. Which financial statement(s) do you need…?
4. Calculate the debt-to-equity ratio for the previous year.
5. Has the company's financial leverage increased?
6. Which footnote … describes the company's long-term debt?
7. Has the company issued any bonds in years past?
8. What interest rate is the company paying on its bonds?
9. When do the bonds mature?
10. Did the company make any payments on its long-term debt in the most recent year shown?
11. Which financial statement shows you this information?
12. Has the company taken on any additional long-term debt in the most recent year shown?
13. Which financial statement shows you this information?
What will be an ideal response?
1. What is the name of your company? Answers will vary
2. Calculate the debt-to-equity ratio for the most recent year. Answers will vary
3. Which financial statement(s) do you need…? Balance sheet
4. Calculate the debt-to-equity ratio for the previous year. Answers will vary
5. Has the company's financial leverage increased? Yes if the ratio increased
No if the ratio decreased
6. Which footnote describes the company's long-term debt? Answers will vary
7. Has the company issued any bonds in years past? Answers will vary
8. What interest rate is the company paying on its bonds? Answers will vary
9. When do the bonds mature? Answers will vary
10. Did the company make any payments on its long-term debt in the most recent year shown? Answers will vary
11. Which financial statement shows you this information? Statement of cash flows
12. Has the company taken on any additional long-term debt in the most recent year shown? Answers will vary.
13. Which financial statement shows you this information? Statement of cash flows
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