Use the Target Corporation’s Form 10-K to complete the case. You will be working with Target’s FY 2012 (year ended February 2, 2013). Target’s Form 10-K is available on the company’s website or through the SEC’s EDGAR database. Appendix A in your text provides instructions for using the EDGAR database.

Questions 31 - 51 are presented below. show all support for your work. You will be using the following sections of the annual report: MD&A, consolidated financial statements and notes to the financial statements.

31. Using Excel, compute common-size income statements (vertical analysis) for 2012 and 2011. In common-size income statements, net sales is 100% and every other number is a percentage of sales (you can stop at net earnings). 32. Using the common-size (vertical) income statements, identify the significant trends.

33. Using Excel, compute common-size (vertical analysis) balance sheets at the end of fiscal 2012 and 2011. In common-size balance sheets, total assets is 100% and every other number is a percentage of total assets. Be sure to complete the entire balance sheet.

34. Using the common-size (vertical) balance sheet, identify the significant trends.

35. Using Excel, prepare a horizontal analysis of the income statement comparing 2012 and 2011 (you can stop at net earnings).

36. Using the horizontal analysis of the income statement, identify the significant trends.

37. Using Excel, prepare a horizontal analysis of the balance sheet comparing 2012 and 2011.

38. Using the horizontal analysis of the balance sheet, identify the significant trends.

For numbers 39-51, calculate the following ratios for 2012 and 2011 **AND analyze the results.

39. Net margin

40. Return on investment

41. Return on equity

42. Earnings per share

43. Price-earnings ratio

44. Book value per share of common stock

45. Working capital

46. Current ratio

47. Quick (acid-test) ratio

48. Accounts receivable turnover

49. Inventory turnover

50. Debt to equity ratio

51. Debt to assets ratio

 

   

Consolidated Statements of Operations (millions, except per share data) 2012 2011 2010 Sales $71,960 $68,466 $65,786 Credit card revenues 1,341 1,399 1,604 Total revenues 73,301 69,865 67,390 Cost of sales 50,568 47,860 45,725 Selling, general and administrative expenses 14,914 14,106 13,469 Credit card expenses 467 446 860 Depreciation and amortization 2,142 2,131 2,084 Gain on receivables held for sale (161) Earnings before interest expense and income taxes 5,371 5,322 5,252 Net interest expense 762 866 757 Earnings before income taxes 4,609 4,456 4,495 Provision for income taxes 1,610 1,527 1,575 Net earnings $2,999 $2,929 $2,920 Basic earnings per share $4.57 $4.31 $4.03 Diluted earnings per share $4.52 $4.28 $4.00 Weighted average common shares outstanding Basic 656.7 679.1 723.6 Diluted 663.3 683.9 729.4