Question

Assume the following is a list of account titles and amounts (in millions) reported at December 31, 2017, by Hasbro, Inc., a leading manufacturer of games, toys, and interactive entertainment software for children and families:

Buildings and Improvements	$	200		Goodwill	$	500
Prepaids and Other Current Assets		176		Machinery and Equipment		438
Allowance for Doubtful Accounts		27		Accumulated Depreciation		378
Other Non-current Assets		205		Inventories		326
Cash and Cash Equivalents		655		Other Intangibles		593
Accounts Receivable		669		Land and Improvements		6

Required:
1. Prepare the asset section of a classified balance sheet for Hasbro, Inc., assuming Hasbro follows ASPE. (Enter your answers in millions. Amounts to be deducted should be indicated by a minus sign.)

December 31, 2017 (in millions) Assets Current assets Total current assets Property, plant, and equipment Total Property, plant, and equipment (at cost) Total property, plant and equipment (net) Other assets Total other assets Total assets

2-a. Assuming that Hasbro’s 2017 Net Sales Revenue was $4,722 (million) and its Net Fixed Assets was $193 (million) at December 30, 2016, calculate the fixed asset turnover ratio for 2017. (Round your answer to 2 decimal places.)

Answer 1

1.

HASBRO INC., Balance Sheet (Partial) December 31, 2017
Assets
Current assets:
Cash and cash equivalents		655
Accounts receivable	$669
Less: Allowance for doubtful accounts	-27	642
Inventories		326
Prepaid and other current assets		176
Total current assets		1,799
Property, plant and equipment
Machinery and equipment		438
Building and improvements		200
Land and improvements		6
Total property, plant and equipment (at cost)		644
Less: Accumulated depreciation		-378
Total property, plant and equipment (net)		266
Other assets
Goodwill		500
Other intangibles		593
Other non current asset		205
Total other assets		1,298
Total assets		$3,363

2a.

Fixed asset turnover ratio = Net sales / Average fixed assets

Average fixed assets = $193+266 / 2 = $229.5

Fixed asset turnover ratio = $4,722 / 229.5 = 20.57