Refer to CVS Corporation’s annual report in the Supplement to Chapter 1 to answer the following questions. (Note that 2004 refers to the year ended January 1, 2005, and 2003 refers to the year ended January 3, 2004.)

1. Consolidated balance sheets:

(a) Did the amount of working capital increase or decrease from 2003 to 2004? By how much?

(b) Did the current ratio improve from 2003 to 2004?

(c) Does the company have long-term investments or intangible assets?

(d) Did the debt to equity ratio of CVS change from 2003 to 2004?

(e) What is the contributed capital for 2004?

How does contributed capital compare with retained earnings?

2. Consolidated statements of operations:

(a) Does CVS use a multistep or single-step income statement?

(b) Is it a comparative statement?

(c) What is the trend of net earnings?

(d) How significant are income taxes for CVS?

Comparison Case: CVS versus Southwest Financial Analysis