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Business, 05.05.2020 07:22 caraxphernelia

The following information is given for Ford for 2001 (in millions):

Ford Ford’s Bond Ratings Altman’s Z-score Model
Total current assets $37,833 Moody’s: A1 6.56 x working capital / total assets
Total current liabilities 43,327 Standard & Poors’: A 3.26 x retained earnings / total assets
Total assets 284,421 6.72 x EBIT / total assets
Retained earnings 17,884 1.05 x BV of equity / BV of debt
Earnings before tax 8,234 = Z-score
Interest expense 9,519 Failing: below 1.1
Total stockholders’ equity 18,610 Gray: 1.1-2.6
Total liabilities 265,138 Healthy: above 2.6

Altman's retained earnings Z-score calculation for Ford is:

a. -.127
b. .205
c. -.107
d. .416

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The following information is given for Ford for 2001 (in millions):

Ford Ford’s Bond Ra...
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