Refer to Canadian Tire's financial statements in Appendix A at the end of the book to answer the following questions. Show amounts in millions.
1. Three important pieces of inventory information are
(a) The cost of inventory on hand,
(b) The cost of goods sold, and
(c) The cost of inventory purchases. Identify or compute each of these items for Canadian Tire at January 3, 2015.
2. Which item in Requirement 1 is most directly related to cash flow? Why?
3. Assume that all inventory purchases were made on account, and that only inventory purchases increased Accounts Payable. Compute Canadian Tire's cash payment for inventory during 2014.