University of Illinois, Urbana Champaign - FIN 221 1)Why did AT,T have identical current and quick ratios?   AT&T reported no short-term debt on their balance sheets

University of Illinois, Urbana Champaign - FIN 221

1)Why did AT,T have identical current and quick ratios?

1. AT&T reported no short-term debt on their balance sheets.

2. AT&T reported no accounts receivable on their balance sheets.

3. AT&T reported no accounts payable on their balance sheets.

4. AT&T reported no inventory on their balance sheets.

2. Which of the following ratios would you like to see decline over time for a company?

1. Inventory Turnover

2. Days Sales Outstanding

3. Fixed Asset Turnover

4. Total Asset Turnover

3. Which of the following ratios might favor a company with older assets vs. a company with newer assets?

1. Inventory Turnover

2. Days Sales Outstanding

3. Fixed Asset Turnover

4. Current Ratio

4. Which ratio(s) were better for AT&T vs. Verizon in both 2007 and 2006?

1. only the debt ratio

2. only the times-interest-earned ratio

3. the debt and time-interest-earned ratios

5. none of AT&T debt management ratios were better than Verizon both years. What are the operational component(s) of the DuPont Equation?

1. profit margin

2. total asset turnover

3. equity multiplier