2. Analyze, Forecast, and Interpret Income Statement and Balance Sheet Following are the income statements and balance sheets of AutoZone Inc.

AUTOZONE INC.

Consolidated Statements of Income

$ thousands

12 Months Ended Aug. 27, 2016

Net Sales

$ 10,635,676

Cost of sales, including warehouse and delivery expenses

$ 5,026,940

Gross profit

$ 5,608,736

Operating, selling, general, and administrative expenses

$ 3,548,341

Operating profit

$ 2,060,395

Interest expense, net

$ 147,681

Income before income taxes

$ 1,912,714

Income tax expense

$ 671,707

Net income

$ 1,241,007

AUTOZONE INC.

Consolidated Statements of Income

$ thousands, except for par value

Aug. 27, 2016

Current assets

Cash and cash equivalent

$ 189,734

Accounts receivable

$ 287,680

Merchandise inventories

$ 3,631,916

Other current assets

$ 130,243

Total current assets

$ 4,239,573

Property and equipment, net

$ 3,733,254

Goodwill

$ 391,887

Deferred income taxes

$ 36,855

Other long-term assets

$ 198,218

Total assets

$ 8,599,787

Current liabilities

Accounts payable

$ 4,095,854

Accrued expenses and other

$ 551,625

Income taxes payable

$ 42,841

Total current liabilities

$ 4,690,320

Long-term debt

$ 4,924,119

Deferred income taxes

$ 284,500

Other long-term liabilities

$ 488,386

Stockholders' deficit

Preferred stock, authorized 1,000 shares; no shares issued

Common stock, par value $0.01 per share, authorized 200,000 shares;

30,329 share issued and 29,118 shares outstanding in 2016 and 32,098 shares issued

and 30,659 shares outstanding in 2015

$ 303

Additional paid-in capital

$ 1,054,647

Retained deficit

($1,602,186)

Accumulated other comprehensive loss

($ 307,529)

Treasury stock, at cost

($ 932,773)

Total stockholders' deficit

($1,787,538)

Liabilities and stockholders' deficit

$ 8,599,787

Forecast AutoZones 2017 income statement and balance sheet using the following relations ($ in thousands). All percentages (other than sales growth and provision for income taxes) are based on percent of net sales.

Net Sales growth

6%

Cost of sales, including warehouse and delivery expenses

47.30%

Operating, selling, general and administrative expenses

33.40%

Interest expense, net

$145,000

Income tax expense (% pretax income)

35%

Accounts receivable

2.70%

Merchandise inventories

34.10%

Other current assets	1.20%
Accounts payable	38.50%
Accrued expenses and other	5.20%
Income taxes payable	0.40%
CAPEX for 2017 will be 4.6% of 2017 Net sales and depreciation will be 8.3% of Property and equipment, net at the start of the fiscal year, which was $3,733,254 thousand. Goodwill, Deferred income taxes, Other long-term liabilities, AOCI, and Treasury stock will not change during the year. Other long-term assets including intangible assets. The 10-K reports that the 2017 amortization expense for intangibles will be $8,482 thousand. Long-term debt will decrease by $1,597,500 in 2017, per the 10-K.