L06 E3-34.Compare GAAP and non-GAAP Measures ANALYST ADJUSTMENTS 3.4 FedEx Corporation reported the following in its May 3 1, 2019 annual earnings release.

Dollars in millions, except EPS Net Income Diluted EPS GAAP measure .... ..... .. ............. $ 540 $ 2.03 MTM retirement accounting adjustments .... 2,981 11.22 TNT express integration expenses ...... . .. 314 1.18 Business realignment costs .............. 243 0.91 FedEx Ground legal matter . ..... .. .. .. .. 43 0.16 Net U.S. deferred tax remeasurement ...... 4 0.02 Non-GAAP measure .. .. ..... .. .. .. .. .. $4,125 $15.52

a. What amount did FedEx report as net income on its 2019 income statement?

b. Explain what FedEx means by non-GAAP measure.

c. How should we treat this non-GAAP information for our analysis purposes?

d. The company's average equity was $ 18,587 million during the year ended May 3 1, 2019. Compute its return on equity using (i) the GAAP net income, and (ii) the non-GAAP net income. Is the difference in return material? Explain.