Best Buy and Circuit City sell consumer electronics in their retail outlets and online stores.

Required 

1. Identify the major revenue and expense accounts you would expect to see reported by Best Buy and Circuit City (you might review their financial statements in Appendix A for general categories).

2. Do you expect any differences in major revenue and expense accounts between these two companies?Identify them, if any.

 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 fax 2005 2004 2003 2002 2001 $27,433 $24,548 1,442 1,304 934 800 $20,943 1,010 622 $17,711 $15,189 908 611 570 401 (29) (441) (5) Gain (loss) on disposal of discontinued operations, net of tax 50 (66) Cumulative effect of change in accounting principles, net of tax (82) Net earnings 984 705 99 570 118 396 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 Cash dividends declared and paid 0.42 0.40 TIRI 1.24 1121 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 18.4% rate 18.6% 18.8% 14.9% 14.5% Operating income rate 5.3% 5.3% 4.8% 5.1% 4.0% Year-End Data Current ratio 1.4 1.3 1.3 1.2 Total assets $10,294 $8,652 $7,694 $7,367 1.1 $4,840 Long term debt, including current portion 600 850 834 820 Total shareholders' equity 4,449 3,422 2,730 2,521 296 1,822 Number of stores U.S. Best Buy stores 668 608 548 481 419 Magnolia Audio Video stores 20 22 19. 13 13 International stores 144 127 112 95 Total retail square footage (000s)) U.S. Best Buy stores 28,260 Magnolia Audio Video stores. International stores 194 3,139 26,421 218 24,243 21,599 19,010 2,800 189 2,375 133 133 1,923