Solved

Sewickley Company Use the Liabilities Section of Sewickley Company's Balance

Question 165

Essay

Sewickley Company Use the liabilities section of Sewickley Company's balance sheet to answer the questions that follow.
Sewickley Company
Consolidated Balance Sheets
(in millions)

 December 31,20172016 Current liabilities  Short-term borrowings $354$202 Accounts payable and other current liabilities 4,4614,529 Income taxes payable 18364 Total current liabilities $4,998$4,795 Long-term debt $2,651$3,009 Other long-term liabilities 3,8763,960 Deferred income taxes (assume all are long-term) 1,4961,367\begin{array}{l}&\text { December } 31,\\&2017&2016\\\text { Current liabilities }\\\text { Short-term borrowings } & \$ 354 & \$ 202 \\\text { Accounts payable and other current liabilities } & 4,461 & 4,529 \\\text { Income taxes payable } & 183 & 64 \\\text { Total current liabilities } & \$ 4,998 & \$ 4,795\\\\\text { Long-term debt } & \$ 2,651 & \$ 3,009 \\\text { Other long-term liabilities } & 3,876 & 3,960 \\\text { Deferred income taxes (assume all are long-term) } & 1,496 & 1,367\\\end{array}

-Review the consolidated balance sheets of Sewickley Company.
Required:
Which one of the liabilities shown in the balance sheets is used in the calculation of the debt-to-equity ratio?
If we can assume that the stockholders' equity total remained relatively constant for the two years, how would the ratio change (increase/decrease) from 2016 to 2017? What would this say about the company's financial position?

Correct Answer:

verifed

Verified

All liabilities are used in the calculat...

View Answer

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents