The notes are an important part of a company’s financial statements, giving valuable details that would clutter the tabular data presented in the statements. This case will help you learn to use a company’s inventory notes. Visit https://www.pearsonglobaleditions .com/Horngren to view a link to Target Corporation’s fiscal year ended February 2, 2019, Annual Report. Access the financial statements and related notes, and answer the following questions:
Requirements 1. Which inventory costing method does Target use? How does Target value its inventories? See Note 9.
2. By using the cost of goods sold formula, you can compute net cost of inventory purchased, which is not reported in the Target financial statements. How much was Target’s net cost of inventory purchased during the year ended February 2, 2019?
3. Determine Target’s inventory turnover and days’ sales in inventory for the year ended February 2, 2019. (Round each ratio to one decimal place.) How do Target’s inventory turnover and days’ sales in inventory compare with Kohl’s Corporation’s for the year ended February 2, 2019? Explain.