Question

2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabilities Days Accounts Receivable 1 Low ST liquidity risk high Low ST liquidity risk 0.4 Low ST liquidity risk Current Assets/ Current Liabilities (Cash+ShortTermInvestments+AccountsReceivable Current Liabilities Operating Cash Flow/0.5(Current Liabilities-2Year) 365/Accounts Receivable Turnover Ratio Accounts Receivable Turnover-Sales 0.5(Accounts Receivable-2Year) 565 Inventory lurnover Ratio Inventory Turnover Ratio Costs of Goods Sold'0.5(Inventory-2Year) 365/Accounts Payable Tumover Ratio Accounts Payable Turnover-Purchase 0.5(Accounts Payable-2Year) Purchase-Cost of Goods Sold+Ending Inventory-Beginning Inventory Days Accounts Receivable +Days Inventory - Days Accounts Payable Total Liability Total Assets Total Liability Shareholders'Equity Long-Tem Debt (Long-Tem Debt+Shareholders' Equity) Long-Term Debt Shareholders' Equity Operating Cash Flow Interest Interest (Statement of Cash Flow) Operating Cash Flow/0.5(Total Liabilities-2Year) Days Inventory Days Accounts Payable Net Days Working Capital Liabilities to Assets Ratio Liabilities to Shareholders' Equity Ratio Long-Term Debt to Long-Tem Capital Ratio Long-Term Debt to Shareholders' Equity Ratio nterest coverage ratio Operating Cash Flow to Average Total Liabilities LT solvency risk 0.2 Low LT solvency risk Altman's Z Score Working Capital Assets: 1.2x Retained Earnings/Assets: 1.4 x EBIT/Assets: 3.3 x Mkt. Value Equity Liablities: 0.6 x Sales, Assets: 1.0× Z-Score Probability of B [Working CapitalCurrent Assets- Current Liabálity)Assets Retained Earnings/Assets EBIT-Earnings before Income Taxes+Interest]Assets Mkt. Value Equity-shares outstanding x price Sales(t TA(t) 0.000 84-134% After calculation, analyze the changes in (1) short-term solvency risk, (2) long-term solvency risk and (3) bankruptcy risk Note 1. Please read the context of question a. when calculate the days account receivable outstanding. The point is to use the only specialty revenues in your calculations! The formula here is the generaal one 2. For number of shares outstanding and price in 2012, please also read the context of question a.

Answer 1

Exhibit 5.26 Wallmart Risk ratios 2015 0.93 0.22 0.42 4.69 45.30 38.95 2014 0.97 0.24 0.42 5.06 44.99 2013 0.88 Current Ratio Quick Ratio operating cash flow to current liabilities Days Accounts Receivable Days inventory Days Accounts Payable Net days working capital Liabilities to asset Ratio Liabilities to Shareholders equity Ratio Long term debt to long term capital ratio Long term debt to Shareholders' equity ratio Interest Coverage ratio Operating cash flow to Average Total liabilities Altman's Z square Probability of Bankruptcy 0.33 5.15 45.19 37.87 38.37 12.1711.98 0.6 1.62 0.35 0.55 11.74922 11.6812.19 0.19 4.41 0% 11.05 0.58 1.44 0.35 0.55 0.58 1.44 0.33 0.5 0.23 4.78 0% 0.24 4.81 0%

Current Ratio: It shows how efficient the company remained to meet its current obligations for running its operations. The ratio continues to increase over period, which indicated the firm has sufficient liquid assets to fulfil its operating expenses. Firm is leveraging more inventory whick weakens the working capital Current Ratio Quick Ratio