Access the classified financial statements for Best Buy and Circuit City in Appendix A.

Required

1. Compare and contrast the assets section on the balance sheet for both Best Buy and Circuit City.How are they different? How are they similar?

2. Best Buy provides more detail for its property, plant, and equipment than Circuit City does. How is that information helpful to the financial statement user?

3. Circuit City provides more detail of its current assets than Best Buy does. What specific additional information provided by Circuit City would prove useful to the financial statement user?

Appendix A:

Transcribed Image Text:

Five-Year Financial Highlights $ in millions, except per share amounts Fiscal Year Consolidated Statements of Earnings Data Revenue Operating income Earnings from continuing operations Loss from discontinued operations, net of tax Gain (loss) on disposal of discontinued operations, net of tax Cumulative effect of change in accounting principles, net of tax Net earnings 2005 2004 2003 2002 2001 $27,433 $24,548 1,442 934 1,304 800 $20,943 1,010 622 $17,711 $15,189 908 611 570 401 - 1 (29) (441) 50 (66) 151 1 (5) - - 984 705 18 (82) 99 570 396 Per Share Data Continuing operations $2.79 $2.41 $1.90 $1.77 $1.26 Discontinued operations (0.09) (1.34) (0.02) Gain (loss) on disposal of discontinued operations 0.15 (0.20) Cumulative effect of accounting changes (0.25) Net earnings 2.94 2.13 0.31 1.77 1.24 Cash dividends declared and paid 0.42 0.40 Common stock price: High 62.20 62.70 53.75 51.47 59.25 Low 43.87 25.55 16.99 22.42 14.00 Operating Statistics Comparable store sales change 4.3% 7.1% 2.4% 1.9% 4.9% Gross profit rate 23.7% 23.9% 23.6% 20.0% 18.5% Selling, general and administrative expense rate 18.4% 18.6% 18.8% 14.9% 14.5% Operating income rate 5.3% 5.3% 4.8% 5.1% 4.0%