3. Assume no dramatic changes in the international business environment. Prepare your estimate of Toys R Uss net sales for the 1995 fiscal year (which will end in February, 1996). Express your estimate as a reasonable range that you think will include the actual amount of net sales, not as a single dollar amount. In developing your estimate, you may use any of the computations in part 1, as well as any other information included in the annual report. Explain fully the reasoning behind your estimate.

Note: We are interested in your reasoning processes, not in the accuracy of your estimate. You are not to look up the actual net sales for fiscal 1995.

4. Starting with your estimate of net sales for fiscal 1995, estimate the range of net income which you expect the company to earn. Again, explain fully the reasoning behind your estimate.

5. At the end of 1994, the market price of the companys capital stock was approximately $29 per share. Assume that net sales and net income both increase to amounts right in the middle of your estimated ranges. Does this mean that the market price of the companys capital stock will increase during 1995? Explain.

ANNUAL REPORT OF TOYS "R" US Intended for Uise after Chapter 8. In this appendix we present the 1995 annual report of Toys "R" Us, a publicly held corporation. This report was selected to illustrate many of the financial reporting concepts discussed in this textbook. But not all of the terminology and accounting policies appearing in this report are consistent with our text discussions. This illustrates some of the diversity that exists in financial reporting. TOSUs ANNUAL REPORT YEAR END ED JANUARY 28. 1 99s ANNUAL REPORT OF TOYS "R" US Intended for Uise after Chapter 8. In this appendix we present the 1995 annual report of Toys "R" Us, a publicly held corporation. This report was selected to illustrate many of the financial reporting concepts discussed in this textbook. But not all of the terminology and accounting policies appearing in this report are consistent with our text discussions. This illustrates some of the diversity that exists in financial reporting. TOSUs ANNUAL REPORT YEAR END ED JANUARY 28. 1 99s