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    DC4 FT221032 Aman

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    Aman Deep
    Both Kellogg's and General Mills have current ratios less than one, indicating current liabilities exceed current assets. Kellogg's long-term debts have increased while General Mills' have decreased. Kellogg's largest cash sources are long-term debt issuance while General Mills' are notes payable and stock revenues.

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    DC4 FT221032 Aman

    Uploaded by

    Aman Deep
    22 views2 pages
    Both Kellogg's and General Mills have current ratios less than one, indicating current liabilities exceed current assets. Kellogg's long-term debts have increased while General Mills' have decreased. Kellogg's largest cash sources are long-term debt issuance while General Mills' are notes payable and stock revenues.

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    DC4.FT221032.Aman

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    Both Kellogg's and General Mills have current ratios less than one, indicating current liabilities exceed current assets. Kellogg's long-term debts have increased while General Mills' have decreased. Kellogg's largest cash sources are long-term debt issuance while General Mills' are notes payable and stock revenues.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    22 views2 pages

    DC4 FT221032 Aman

    Uploaded by

    Aman Deep
    Both Kellogg's and General Mills have current ratios less than one, indicating current liabilities exceed current assets. Kellogg's long-term debts have increased while General Mills' have decreased. Kellogg's largest cash sources are long-term debt issuance while General Mills' are notes payable and stock revenues.

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    © All Rights Reserved
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    DC 9-1

    1.

    2.
    Both companies' current ratios are roughly the same and are less than one. This indicates
    that the companies' current liabilities exceed their current assets. Unless cash is created,
    they may not be able to pay their present liabilities.
    3. Yes, Kellogg's and General Mills are liable in the event of a lawsuit or litigation. They are
    stated in the Notes section of the financial statements because they are not deemed to
    have an influence on the financial statements.

    DC 9-3

    1. If the company believes it has significant factual and legal defences to the claims at hand,
    it should not be disclosed on the balance sheet since it does not meet the probable
    condition and cannot be reasonably estimated. The contingencies, on the other hand,
    must be stated in the financial statement notes.

    The accrual of a contingent liability will increase liabilities and cause a contingency
    expense, both of which will reduce the company's net income.

    2. The accrual isn't required because the management can't forecast how this situation will
    end. It's not likely, and there's no way to know for sure.

    DC 10-2

    1.
    For both companies, the debt-to-equity ratio is fairly high. Kellogg's has a larger debt-to-
    equity ratio than the other two corporations. For investors, this could be a source of
    anxiety.
    2. General Mills' long-term liabilities have dropped, whereas Kellogg's long-term debts have
    climbed.
    General Mills' long-term obligations have dropped, and its cash has declined as well.
    Kellogg's long-term debts have increased, although cash has also increased.

    3. Issuance of long-term debt is Kellogg's most major cash source, while common-stock
    purchases and dividend payments are the most important uses of cash.
    Issuance of Notes Payable and revenues from stocks are the most major cash sources for
    General Mills, while payment of long-term loans is the most important use of cash.
    The issue of long-term obligations and an increase in cash are indicated by an increase in
    long-term liabilities, whereas the payment of long-term debts and a drop in cash are
    indicated by a decline in long-term liabilities.

    DC 11-1

    1.

    2. Retained Earnings grew from $5481 million to $6122 million for Kellogg's.
    Retained Earnings rose from $7235.6 million to $8122.4 million for General Mills.
    Increased Net Income Dividend payouts and retained earnings balances are both
    declining.
    3. General Mills' total stockholders' equity is $5648 million dollars. Kellogg's total
    stockholder equity is $2154 million. The quantity difference does not imply that one's
    company shares is worth more. For a large corporation, stockholder equity can be
    considerable, but that does not mean the stock is more valuable.

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