Question

Krispy Kreme Doughnuts, Inc. is a leading retailer and wholesaler of doughnuts. Krispy Kreme owns or franchises 1,000 stores where the "hot" light tells you if doughnuts are cooking. Dunkin’ Brands Group, Inc. is a leading franchisor of doughnut (Dunkin’ Donuts) and ice cream (Baskin-Robbins) shops with more than 19,000 stores worldwide. Selected financial statement information for a recent year for both companies follows (in thousands):

Krispy Kreme Dunkin' Brands

Operating expenses $442,09 $432,535

Depreciation expense $12,840 $19,779

Cash (end of year balance) $50,971 $208,080

a. Determine the days' cash on hand for each company. Round all calculations to one decimal place. Krispy Kreme Dunkin' Brands Days' Cash on Hand days days

b. Which company appears to have the stronger cash liquidity position?

Answer 1

a) Krispy Kereme 43.35 Days Dunkin Brands 184.01

B) Dunkin Brands seems to have a better cash liquidity position

Step-by-step explanation:

Days cash on hand is the number of days that an organisation can continue to pay its operating expenses from the cash available

Days Cash on hand ÷ ((Operating expenses - Noncash expenses) ÷ 365)

Note: I assumed $442,09 is $442,009.00

Pls find see attachment for Calculation