Analysis and Interpretation of ProfitabilityBalance sheets and income statements for Best Buy Co., I

Analysis and Interpretation of ProfitabilityBalance sheets and income statements for Best Buy Co., Inc. follow.Consolidated Statements of EarningsFor Fiscal Years Ended ($ millions)February 27,2010RevenueFebruary 28,2009March 1,2008$ 49,694$ 40,02337,53434,01730,477——12,16010,9989,5469,8738,9847,3855278—-66–2,2351,8702,1615435129–(111)–(94)(94)(62)2,1951,7002,22880267481517(3)1,3941,0331,410(77)(30)(3)$ 1,317Cost of goods sold$ 45,015$ 1,003$ 1,407Restructuring charges – cost of goods soldGross ProfitSelling, general and administrative expensesRestructuring chargesGoodwill and tradename impairmentOperating incomeOther income (expense)Investment income and otherInvestment impairmentInterest expenseEarnings before income tax expense and equity in income ofaffiliatesIncome tax expenseEquity in income of affiliatesNet earnings including noncontrolling interestNet income attributable to noncontrolling interestNet income attributable to Best Buy Co., Inc.Consolidated Balance Sheets($ millions, except footnotes)February 27,2010February 28, 2009AssetsCurrent assetsCash and cash equivalents$ 1,826$ 4989011Receivables2,0201,868Merchandise inventories5,4864,753Other current assets1,1441,062Short-term investmentsConsolidated Statements of EarningsFor Fiscal Years Ended ($ millions)RevenueFebruary 27,2010February 28,2009March 1,2008$ 49,694$ 45,015$ 40,023Cost of goods sold37,53434,01730,477Total current assets10,5668,192757755Leasehold improvements2,1542,013Fixtures and equipment4,4474,060951127,4536,9403,3832,766Property and equipment, net4,0704,174Goodwill2,4522,203Tradenames, net159173Customer relationships, net279322Equity and other investments324395452367$ 18,302$ 15,826$ 5,276$ 4,997Unredeemed gift card liabilities463479Accrued compensation and related expenses5444591,6811,382Accrued income taxes316281Short-term debt6637833554Total current liabilities8,9788,435Long-term liabilities1,2561,109Long-term debt1,1041,126Property and equipmentLand and buildingsProperty under capital leaseLess: Accumulated depreciationOther noncurrent assetsTotal assetsLiabilities and equityCurrent liabilitiesAccounts payableAccrued liabilitiesCurrent portion of long-term debtConsolidated Statements of EarningsFor Fiscal Years Ended ($ millions)RevenueCost of goods soldFebruary 27,2010February 28,2009March 1,2008$ 49,694$ 45,015$ 40,02337,53434,01730,477EquityBest Buy Co., Inc. Shareholders’ equityPreferred stock, $1.00 par value—-Common stock, $0.10 par value42414412055,7974,71440(317)6,3204,6436445136,9645,156$ 18,302$ 15,826Additional paid-in capitalRetained earningsAccumulated other comprehensive income (loss)Total Best Buy Co., Inc. shareholders’ equityNoncontrolling interestTotal equityTotal liabilities and equity(a) Compute net operating profit after tax (NOPAT) for 2010. Assume that the combined federal andstatutory rate is: 37.0%. (Hint: Treat income in equity of affiliates as operating. Round your answer tothe nearest whole number.)2010 NOPAT = Answer($ millions)(b) Compute net operating assets (NOA) for 2010 and 2009. (Hint: Treat the Equity and OtherInvestments and the Long-Term Liabilities as operating.)2010 NOA = Answer($ millions)2009 NOA = Answer($ millions)(c) Compute Best Buy’s RNOA, net operating profit margin (NOPM) and net operating asset turnover(NOAT) for 2010. (Do not round until final answer. Round two decimal places. Do not use NOPM xNOAT to calculate RNOA.)2010 RNOA = Answer%2010 NOPM = Answer%2010 NOAT = Answer(d) Compute net nonoperating obligations (NNO) for 2010 and2009.2010 NNO = Answer($ millions)2009 NNO = Answer($ millions)(e) Compute return on equity (ROE) for 2010. (Round your answers to two decimal places. Donot round until your final answer.)2010 ROE = Answer%(f) Infer the nonoperating return component of ROE for 2010. (Use answers from above tocalculate. Round your answer to two decimal places.)2010 nonoperating return = Answer%CheckCompute NOPAT Using Tax Rates from Tax FootnoteThe income statement for The TJX Companies, Inc., follows.THE TJX COMPANIES, INC.Consolidated Statements of IncomeFiscal Year Ended ($ thousands)Net salesCost of sales, including buying and occupancy costsSelling, general and administrative expensesProvision (credit) for computer intrusion related costsInterest expense (revenue), netIncome from continuing operations before provision for incometaxesProvision for income taxesIncome from continuing operationsGain from discontinued operations, net of income taxesNet incomeU.S. federal statutory income tax rateJanuary 28, 2006$16,057,93512,295,0162,723,96029,6321,009,327318,904690,423$ 690,42335.0%Effective state income tax rate3.9%Impact of foreign operation0.5%All otherWorldwide effective income tax rate-7.8%31.6%Compute TJX’s NOPAT for 2006 using its income tax footnote disclosure. (The Federal and Statetax rate for 2006 as reported by TJX’s tax footnote is: 38.9%). Round to the nearest whole number.2006 NOPAT = $AnswerAssessing Financial Statement Effects of AdjustmentsFor each of the following separate situations, prepare the necessary accounting adjustments usingthe financial statement effects template.(a) Unrecorded depreciation on equipment is $610.(b) The Supplies account has an unadjusted balance of $2,990. Supplies still available at the end ofthe period total $1,100.(c) On the date for preparing financial statements, an estimated utilities expense of $390 has beenincurred, but no utility bill has yet been received or paid.(d) On the first day of the current period, rent for four periods was paid and recorded as a $2,800debit to Prepaid Rent and a $2,800 credit to Cash.(e) Nine months ago, The Allstate Corporation sold a one­year policy to a customer and recordedthe receipt of the premium by crediting Unearned Revenue for $624. No accounting adjustmentshave been prepared during the nine­month period. Allstate’s annual financial statements are nowbeing prepared.(f) At the end of the period, employee wages of $965 have been incurred but not paid or recorded.(g) At the end of the period, $300 of interest has been earned but not yet received or recorded.I need help with D and E to show on balance sheet and income statement

 

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