3 P13-3 (Static) Calculating Profitability, Turnover, Liquidity, and Solvency Ratios LO 13-4, 13-5, 13-6, 13-7 Using the financial information presented in Exhibit 13.1, calculate the following ratios for fiscal 2017 for The Home Depot: (Do not round your intermediate calculations and round your answers to 2 decimal places. Round your percentage answers to 2 decimal places. (i.e., 0.1234 should be entered as 12.34).) Answer is complete but not entirely correct. Return on equity 298.25 % Return on assets 19.73 % Total asset turnover 2.31 Inventory turnover 5.26 Current ratio 1.17 Quick ratio Cash coverage ratio Debt-to-equity ratio 0.34 14.96 29.63 THE HOME DEPOT, INC. Consolidated Statements of Cash Flows (amounts in millions) Cash Flows from Operating Activities: Fiscal Fiscal Fiscal 2017 2016 2015 Net Earnings $8,630 $ 7,957 $ 7,009 Reconciliation of Net Earnings to Net Cash Provided by Operating Activities: Depreciation and 2,062 1,973 1,863 Amortization Stock-Based Compensation Expense Gain on Sales of Investments Changes in Assets and Liabilities, net of the 273 267 244 (144) effects of acquisitions: Receivables, net 139 (138) (181) Merchandise Inventories (84) (769) (546) Other Current Assets (10) (48) (5) Accounts Payable and 352 446 888 Accrued Expenses Deferred Revenue 128 99 109 Income Taxes Payable 29 109 154 Deferred Income Taxes 92 (117) 15 Other 420 (33) Net Cash Provided by 12,031 9,783 9.373 Operating Activities Cash Flows from Investing Activities: Capital Expenditures, net of non-cash capital expenditures Proceeds from Sales of Investments (1,897) - (1,621) - (1,503) 144 THE HOME DEPOT, INC. Consolidated Balance Sheets (amounts in millions, except per share data) End of End of Fiscal Fiscal 2017 2016 Assets Current Assets: Cash and Cash Equivalents $ 3,595 $ 2,538 Receivables, net 1,952 2,029 Merchandise Inventories 12,748 12,549 Other Current Assets 638 608 Total Current Assets 18,933 17,724 Net Property and Equipment 22,075 21,914 Goodwill 2,275 2,093 Other Assets 1,246 1,235 Total Assets $44,529 $42.966 Liabilities and Stockholders' Equity Current Liabilities: Short-Term Debt Accounts Payable Accrued Salaries and Related $ 1,559 S 710 7,244 7,000 1,640 1,484 Expenses Sales Taxes Payable 520 508 Deferred Revenue 1,805 1,669 Income Taxes Payable 54 25 Current Installments of Long Term 1,202 542 Debt Other Accrued Expenses 2,170 2,195 Total Current Liabilities 16,194 14,133 Long Term Debt, excluding current 24,267 22.349 installments Deferred Income Taxes Other Long Term Liabilities Total Liabilities 440 296 2,174 1,855 43,075 38,633 Stockholders' Equity Common Stock, par value $0.05; authorized: 10,000 shares; issued: 1,780 shares at January 28, 2018, and 1,776 at January 29, 2017 Pand In Cantal Relamed Farmings Accumulated Other Comprehensive 89 88 10,192 9,187 39,935 35.519 (566) (867) Treasury Stock, all cost, 672 shares al January 28, 2018, and $73 shares at January 29, 2017 Total Stockholders' Equnty Total Liabilities and Stockholders' Equity (48,196) (40,194) 1,454 4,333 $44,529 $47.966 THE HOME DEPOT, INC. Consolidated Statements of Cash Flows (amounts in millions) Cash Flows from Operating Activities: Fiscal Fiscal Fiscal 2017 2016 2015 Net Earnings $8,630 $ 7,957 $ 7,009 Reconciliation of Net Earnings to Net Cash Provided by Operating Activities: Depreciation and 2,062 1,973 1,863 Amortization Stock-Based 273 267 244 Compensation Expense Gain on Sales of Investments Changes in Assets and Liabilities, net of the (144) effects of acquisitions: Receivables, net 139 (138) (181) Merchandise Inventories (84) (769) (546) Other Current Assets (10) (48) (5) Accounts Payable and 352 446 888 Accrued Expenses Deferred Revenue 128 99 109 Income Taxes Payable 29 109 154 Deferred Income Taxes 92 (117) 15 Other 420 (33) Net Cash Provided by 12,031 9,783 9.373 Operating Activities Cash Flows from Investing Activities: Capital Expenditures, net of non-cash capital expenditures Proceeds from Sales of Investments (1,897) - (1,621) - (1,503) 144 non-cash capital expenditures Proceeds from Sales of Investments Payments for Businesses Acquired, net Proceeds from Sales of (1,897) (1,621) - (1,503) 144 (374) - (1,666) 47 38 43 Property and Equipment Other Investing Activities (4) Net Cash Used in (2,228) (1,583) (2,982) Investing Activities Cash Flows from Financing Activities: Proceeds from Short-Term 850 360 60 Debt, net Proceeds from Long-Term 2,991 4,959 3,991 Debt, net of discount Repayments of Long-Term (543) (3,045) (39) Debt Repurchases of Common (8,000) (6,880) (7,000) Stock Proceeds from Sales of 255 218 228 Common Stock Cash Dividends (4,212) (3,404) (3,031) Other Financing Activities (211) (78) 4 Net Cash Used in (8,870) (7,870) (5,787) Financing Activities Change in Cash and Cash 933 330 604 Equivalents Effect of Exchange Rate 124 (8) (111) Changes on Cash and Cash Equivalents Cash and Cash Equivalents at Beginning of Year Equivalents at End of 2,538 2,216 1,723 $3,595 $ 2,538 $ 2,216 Cash and Cash Year Supplemental Disclosures: Cash Paid for Interest, net $ 991 $ 924 $ 874 of interest capitalized Cash Paid for Income Taxes 4,732 4,623 3.853 Non-cash Capital 150 179 165 Expenditures Source: The Home Depot Inc