3. How did Dell finance its fiscal 1996 sales growth?

Look for changes in the balance sheet from 1995 to 1996 to see how the growth was financed.

Exhibit 4 Profit & Loss Statements for Dell Computer Corporation (millions of dollars). 1994 1993 $2,873 $2,014 Fiscal Year 1996 1995 1992 Sales $5,296 $3,475 $890 Cost of Sales 229 2,737 2,440 565 608 Gross Margin 1,067 738 433 449 282 Operating Expenses 690 472 21 4B9 Operating Income (39) 377 249 39 67 Financing & Other Income 36 Income Taxes 41 Net Profit (36) 272 49 02 51 Source: Dell Computer Corporation Fiscal 1996 Annual Report. Exhibit 5 Balance Sheets for Dell Computer Corporation (millions of dollars). Year Ended January 28, January 29, January 30, 1996 1995 1994 Current Assets: Cash 43 Short Term Investments 334, 59 484 Accounts Receivables, net 726 538 41 293 220 nventories 429 Other 112 Total Current Assets 1,470 04B 1,957 Property, Plant & Equipment, net 179 11 87 Other Total Assets 2,148 1,594 1,140 Current Liabilities: Accounts Payable 403 NA 466 Accrued and Other Liabilities 473 Total Current Liabilities 939 752 538 Long Term Debt 113 113 100 Other Liabilities 23 Total Liabilities 1,175 669 942 Stockholders' Equity: Preferred Stocka 120 Common Stocka 242 430 Retained Earnings NA 570 Other 33 Total Stockholders' Equity 47 973 652 2,148 1,594 1,140 Source: Dell Computer Corporation Fiscal 1994-1996 Annual Reports. 3,190,000 shares of preferred stock converted to common stock in fiscal year1996