Question

comment on the liquidity of both companies and compare

Advanced Auto Balance Sheet: Period Ending: Trend 12/29/2018 12/30/2017 12/31/2016 1/2/2016 Current Assets Cash and Cash Equivalents $896,527 $546,937 $135,178 $90,782 Short-Term Investments $0 $0 $0 $0 Net Receivables I$624,972 $606,357 $641,252 $597,788 Inventory $4,362,547 $4,168,45 $4,325,868 $4,174,768 Other Current Assets $198,408 $105,106 $70,466 $77,408 Total Current Assets $6,082,454 $5,426,892 $5,172,764 $4,940,746 Long-Term Assets Long-Term Investments $0 $0 $0 $0 Fixed Assets $1,368,985 $1,394,138 $1,446,340 $1,434,577 Goodwill $990,237 $994,293 $990,877 $989,484 Intangible Assets $550,593 $597,674 $640,903 $687.125 Other Assets $48,379 $69,304 $64,149 $75,769 Deferred Asset Charges $0 S0 $0 $0 Total Assets $9,040,648 $8,482,301 $8,127,701 $8,315,033 Current Liabilities I $3,795,931 $3,428,130 $3,640,574 $3,757,085 Accounts Payable Short-Term Debt / Current Portlon of Long- Term Debt $0 $0 $598 ..$90,019 Other Current Liabilities $51.967 $35,472 $39,794 I $3,885,950 $3,480,097 $3,676,046 $3,797,477 Total Current Liabilities $1,044,327 $1,042,949 $1,206,297 Long-Term Debt $1,045,720 $229,354 Other Liabilities II$239,812 $239,061 $225,564 ull$318,353 $303,620 $454,282 $433,925 Deferred Liability Charges $0 $0 $0 $0 Misc. Stocks $0 s0 $0 Minority Interest so $5,398,841 $5,067,105 $5,667,053 J $5,489,835 Total Liabilities Stock Holders Equity $8 $7 $8 $8 Common Stocks $603,332 I$694,797 $664,646 $631,052 Capital Surplus $2,021,077 $2,462,935 Ilt$3,326,155 $2,920,096 Retained Earnings ($119,709) ($138,102) I($425,954) ($144,600) Treasury Stock ($44,059) ($24,954) ($39,701) ($44,193) Other Equity li $3,550,813 $3,415,196 $2,916,192 $2,460,648 Total Equity 01 $ 8,315,033 $8,127,701 lI$9,040,648 Total Liabilities & Equity Total liabilities/ total assets= debt/asset ratio 2018-5,489,835/9,040,648= 0.61 2017 -5,067,105/ 8,482,301= 0.60 2016-5,398,841/ 8,315,033-0.65 2015-5,667,053/ 8,127,701 0.68 Current assets/ Current Liabilities= Current ratio 6,082,454/3,885.950= 1.57 AutoZone Balance Sheet: values in 000's) Get Quarterly Data Annual Income Statemer 8/26/2017 Trend 8/25/2018 8/27/2016 8/29/2015 Period Ending: Current Assets $293,270 l$217,824 $189,734 $175,309 Cash and Cash Equivalents $0 Short-Term Investments $0 $0 $0 l $258,136 Net Receivables $287,680 $251,503 $280,733 $3,421,635 $3,631,916 Inventory $3,943,670 $3,882,086 $155,166 Other Current Assets $130,243 $121,847 $216,239 $4,635,869 $4,611,255 $4,239,573 $3,970,294 Total Current Assets Long-Term Assets $0 $0 $0 $0 Long-Term Investments li$4,218,400 $4,031,018 $3,733,254 $3,505,632 Fixed Assets $391,887 $302,645 $391,887 $391,887 Goodwill Intangible Assets $0 $0 $0 $0 $190,313 Other Assets $155,446 $198,218 $191,921 Deferred Asset Charges $34,620 $35,308 $36,855 $42,615 I $9,346,980 $9,259,781 $8,599,787 $8,102,349 Total Assets Current Liabilities Accounts Payable $5,028,681 $4,766,301 $4,690,320 $4,712,873 Short-Term Debt / Current Portion of Long-Term Debt $0 $0 $0 $0 Other Current Liabilities $0 $0 $0 $0 Total Current Liabilities $4,690,320 $4,712,873 $5,028,681 $4,766,301 Long-Term Debt $5,005,930 $5,081,238 $4,924,119 $4,624,876 Other Liabilities $469,508 $547,520 $488,386 $465,990 Deferred Liability Charges $285,204 $371,111 $284,500 $0 Misc. Stocks $0 $0 $0 $0 Minority Interest $0 $0 $0 $0 II$10,867,335 $10,688,158 $10,387,325 $9,803,739 Total Liabilities Total liabilities/total assets= debt/asset ratio 2018-10,867,335/ 9,346,980= 1.16 2017-10,688,158/9,259,781= 1.15 2016-10,387,325/8,599,787=1.21 2015-9,803,739/ 8,102,349 1.21 Current assets/ Current Liabilities= Current ratio 2018-4,635,869/ 5,028,681=0.92

Answer 1

Advance Auto
Year	2018	2017	2016	2015
current ratio = total of current assets/total of current liabilities	1.57	1.56	1.41	1.30
total current assets	6082454	5426892	5172764	4940746
total of current liabilities	3885950	3480097	3676046	3797477
	2018	2017	2016	2015
Quick ratio ratio = total of quick assets/total of current liabilities	0.44	0.36	0.23	0.20
total current assets	6082454	5426892	5172764	4940746
Inventory	4362547	4168492	4325868	4174768
total of quick assets = total of current assets-inventory	1719907	1258400	846896	765978
total of current liabilities	3885950	3480097	3676046	3797477
Autozone
Year	2018	2017	2016	2015
current ratio = total of current assets/total of current liabilities	0.92	0.97	0.90	0.84
total current assets	4635869	4611255	4239573	3970294
total of current liabilities	5028681	4766301	4690320	4712873
	2018	2017	2016	2015
Quick ratio ratio = total of quick assets/total of current liabilities	0.14	0.15	0.13	0.12
total current assets	4635869	4611255	4239573	3970294
Inventory	3943670	3882086	3631916	3421635
total of quick assets = total of current assets-inventory	692199	729169	607657	548659
total of current liabilities	5028681	4766301	4690320	4712873
Year	2018	2017	2016	2015
Advanced Auto- current ratio	1.57	1.56	1.41	1.30
AutoZone -current ratio	0.92	0.97	0.90	0.84
From the current ratio of previous 4 years we can say that current ratio is better in case of Advanced Auto in comparison to Auto zone so liquidity position of Advanced Auto is better than the Auto zone
Year	2018	2017	2016	2015
Advanced Auto- Quick Ratio	0.44	0.36	0.23	0.20
Auto Zone - Quick Ratio	0.14	0.15	0.13	0.12
Advanced Auto performance is better than Auto zone in case of liqudity ratio.
Thus we can conclude that liqudity position of Advanced auto is better in comparison to Auto zone but Liqudity ratio of advanced auto is below the standard current ratio of 2 and quick ratio of 1