Accounting

Case 6-1 You chair the Board of Directors at Target Corporation. After the firm released its 2014 financial statements, you are faced with an important decision. The first agenda item at the next board meeting is head of the board, you will whether to retain or dismiss the company's chief executive officer. As state your position, and moderate the ensuing discussion. As you contemplate this introduce this issue, important recommendation, you consider the following items about your company and its industry Target Corporation is a Minnesota company incorporated in 1902. Target described itsel 2014 annual report by stating, "We offer our customers everyday essentials and fashionable differentiated merchandise at discounted prices." Target is the second largest discount retailer in the United States behind Walmart when measured by sales revenues, total assets, and market capitalization. Retailing is the economic sector that links the producer of products to end-use customers. It is the largest segment of the American economy. The totality of retail transactions constitutes about two-thirds gross domestic product (GDP) in the United States, according to U.s. Department ofcommerce. Financial analysts view merchandising as a mature industry, defined by intense competition, low profit margins, and business consolidation. Numerous economic factors affect retailers. Notable among them are real changes (inflation adjusted) in GDP, levels of disposable income, and consumer confidence In short, people shop when they have money, and they are confident that they will have it in the future. Consequently, retailers tend to thrive during economic expansions and suffer during economic contractions The 2007-2009 economic down tum hurt sales for all retailers. Sales have rebounded in the years after the recession, but many analysts feel that industry performance remains sluggish. Marketers customers is value. Consumers, regardless of economic note the post-recession watchword for retail standing, want quality at a relatively low price A recent threat to traditional bricks and mortar retailers, such as Target, has been the rise of online retailing. Firms such as Amazon have taken sales and market share away from Target, Walmart and others who primarily sell their goods at fixed locations. In addition to this general industry threat Target has faced numerous company issues. The primary ones are an ill-fated attempt to launch stores in Canada, an extensive data breach to its customers' information, and the erratic performanc of its Target credit card business. More importantly, some analysts have criticized Target from losing sight of its objective as the upscale discounter, a purveyor of cheap chic, which differentiated the firm from it ompetitors You tum your attention to Target's four most recent income statements, balance sheets, and statements of cash flows excerpts