See the attached financial statements for Green Mountain Coffee Roasters, Inc. (GMCR).
Exercise 1
As of September 26, 2009, GMCR had reported $99,600,000 in Goodwill on its balance sheet. Based on your reading of the Notes to the Financial Statements, how much of this Goodwill is attributable to each acquisition the company has made?
Company Acquired Goodwill
Total $99,600,000
Exercise 2
In Note 5 to the Financial Statements, GMCR disclosed that the company had:
• $90,782,000 in green coffee purchase commitments
• $118,962,000 in fixed price brewer inventory purchase commitments and
• $91,602,000 in production raw materials commitments.
Calculate GMCR's Debt-Asset ratio as of September 26, 2009.
Recalculate GMCR’s Debt-Asset ratio as if the above purchase commitments were capitalized on GMCR’s balance sheet.
Exercise 3
See the excerpt provided from GMCR’s Note 9. Compute the following ratios for the two reportable segments in 2009:
SCBU Keurig
Total Asset Turnover
Pretax Margin
Which of the two segments is most profitable? How do you know?
Which of the two segments is most productive? How do you know?
Exercise 4
Compute GMCR’s Debt-Asset Ratio for September 27, 2008 and September 26, 2009
September 27, 2008 September 26, 2009
Debt-Asset Ratio
From information given in the attached financial statements, explain the primary reason for the change in GMCR’s Debt-Asset Ratio.
Exercise 5
Read Note 13, and then explain, in your own words, why GMCR enters into coffee futures contracts. How do these contracts affect GMCR’s net income trends? Cash flow trends?
Explain how the company accounts for changes in the market value of these contracts.
Exercise 6
In September 26, 2009, GMCR received a patent litigation settlement of $17,000,000. Show how this affected GMCR’s Pretax Margin and Net Profit Margin
Pretax Margin Net Profit Margin
As reported on income statement
Adjusting for patent litigation settlement
Attachment:- assignment.pdf