The following selected information was taken from the

financial statements
The following selected information was taken from the financial statements

The following selected information was taken from the financial statements of one of the world's
largest convenience store operators, Montreal-based Alimentation Couche-Tard Inc. (in U.S. $
millions):

Instructions

(a) Calculate each of the following ratios for 2015 and 2014. Industry ratios are shown in
parentheses.

1. Current ratio (2015, 1.7:1; 2014, 1.5:1)

2. Receivables turnover (2015, 29.2 times; 2014, 30.8 times)

3. Inventory turnover (2015, 10.7 times; 2014, 14.9 times)

4. Debt to total assets (2015, 44.0%; 2014, 40.0%)

5. Times interest earned (2015, 12.0 times; 2014, 9.0 times)

(b) Based on your results in part P10.7B(a), comment on Alimentation Couche-Tard's liquidity
and solvency.

(c) Alimentation Couche-Tard has an unused operating line of credit of over U.S. $3 billion. Why
would a bank be willing to provide such a large line of credit?

The following selected information was taken from the financial statements
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