accounting question. Please look at the doc attached

ACT - Accounting for Decision Makers Walmart Analysis Assignment Part 1 Perform a vertical and horizontal analysis of Wal-Mart Stores, Inc.'s income statements and balance sheets as of January 31, 2015. In performing this analysis, consider any notable trends or changes that you observe that may provide useful information concerning its financial condition. Also use as many years' worth of statements as you feel necessary. You should write up your results in paragraph form. Part 2 Assess Wal-Mart, Stores Inc. concerning liquidity, solvency, profitability, and stock performance as of January 31, 2015. For each area, you should calculate the ratios we discussed in class and provide an analysis of the ratios calculated. I include historical stock price information and outstanding common share information below. Fiscal Year Ended Adjusted Closing Price Common Shares Outstanding (millions) 1/31/2015 $83.94 3,228 1/31/2014 $71.97 3,233 1/31/2013 $65.79 3,314 1/31/2012 $56.32 3,418 Fiscal Year Ended January 31, Revenues: Net sales Membership and other income WAL MART STORES INC 10-K Income Statement (Amounts in millions except per share data) 2015 2014 Costs and expenses: Cost of sales Operating, selling, general and administrative expenses Operating income Interest: Debt Capital leases Interest expense Interest income Interest, net Income from continuing operations before income taxes Provision for income taxes: Current Deferred Total provision for income taxes Income from continuing operations Income (Loss) from discontinued operations, net of tax Consolidated net income Consolidated net income attributable to noncontrolling interest Consolidated net income attributable to Walmart $482,229 $473,076 3,422 3,218 485,651 476,294 365,086 93,418 27,147 358,069 91,353 26,872 2,161 300 2,461 (113) 2,348 24,799 2,072 263 2,335 (119) 2,216 24,656 8,504 (519) 7,985 16,814 285 17,099 (736) 8,619 (514) 8,105 16,551 144 16,695 (673) $16,363 $16,022 Net income per common share: Basic income per common share from continuing operations to Walmart Basic income (loss) per common share from discontinued operations $5.01 $0.06 $4.87 $0.03 Basic net income per common share attributable to Walmart $5.07 $4.90 Diluted income per common share from continuing operations to Walmart Diluted income (loss) per common share from discontinued operations $4.99 $0.06 $4.85 $0.03 Diluted net income per common share $5.05 $4.88 Weighted-average number of common shares: Basic Diluted Dividends declared per common share 3,230 3,243 $1.92 3,269 3,283 $1.88 WAL MART STORES INC 10-K Balance Sheet (Amounts in millions except per share data) January 31, 2015 2014 ASSETS Current assets: Cash and cash equivalents $9,135 $7,281 Receivables 6,778 6,677 Inventories 45,141 44,858 Prepaid expenses and other 2,224 1,909 Current assets of discontinued operations 0 460 Total current assets $63,278 $61,185 Property and equipment, at cost Less accumulated depreciation Property and equipment, net 177,395 (63,115) 114,280 173,089 (57,725) 115,364 Property under capital lease Less accumulated amortization Property under capital lease, net 5,239 (2,864) 2,375 5,589 (3,046) 2,543 Goodwill Other assets and deferred charges 18,102 5,671 19,510 6,149 $203,706 $204,751 Total assets LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities: Short-term borrowings $1,592 Accounts payable 38,410 Accrued liabilities 19,152 Accrued income taxes 1,021 Long-term debt due within one year 4,810 Obligations under capital leases due within one ye 287 Current liabilities of discontinued operations 0 $7,670 37,415 18,793 966 4,103 309 89 Total current liabilities 65,272 69,345 Long-term debt Long-term obligations under capital leases Deferred income taxes and other Redeemable non-controlling interest Commitments and contingencies 41,086 2,606 8,805 0 0 41,771 2,788 8,017 1,491 0 Shareholders equity: Common stock Capital in excess of par value Retained earnings Accumulated other comprehensive income (loss) 323 2,462 85,777 (7,168) 323 2,362 76,566 (2,996) Total Walmart shareholders' equity 81,394 76,255 Noncontrolling interest 4,543 5,084 Total equity 85,937 81,339 $203,706 $204,751 Total liabilities and shareholders equity WAL MART STORES INC Horizontal Analysis Income Statement (Amounts in millions except per share data) Fiscal Year Ended January 31, Revenues: Net sales Membership and other income Increase % Increase (Decrease) (Decrease) 2015 Total Revenue 2014 $482,229 3,422 485,651 $473,076 3,218 476,294 $9,153 $204 $9,357 1.93% 6.34% 1.96% 358,069 91,353 26,872 $7,017 $2,065 $275 1.96% 2.26% 1.02% 2,072 263 2,335 (119) 2,216 24,656 $89 $37 $126 $6 $132 $143 4.30% 14.07% 5.40% 5.04% 5.96% 0.58% 8,619 (514) 8,105 16,551 144 16,695 (673) $16,022 $115 $5 $120 $263 $141 $404 $63 $341 1.33% 0.97% 1.48% 1.59% 97.92% 2.42% 9.36% 2.13% Costs and expenses: Cost of sales 365,086 Operating, selling, general and administrative expense 93,418 Operating income 27,147 Interest: Debt 2,161 Capital leases 300 Interest expense 2,461 Interest income (113) Interest, net 2,348 Income from continuing operations before income taxe 24,799 Provision for income taxes: Current 8,504 Deferred (519) Total provision for income taxes 7,985 Income from continuing operations 16,814 Income (Loss) from discontinued operations, net of tax 285 Consolidated net income 17,099 Consolidated net income attributable to noncontrolling (736) Consolidated net income attributable to Walmart $16,363 Balance Sheet Horizontal Analysis (Amounts in millions except per share data) January 31, ASSETS Current assets: Cash and cash equivalents Receivables Inventories Prepaid expenses and other Current assets of discontinued operations Total current assets Property and equipment, at cost Less accumulated depreciation Property and equipment, net Property under capital lease Less accumulated amortization Property under capital lease, net Goodwill Other assets and deferred charges Total assets LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities: Short-term borrowings Accounts payable Accrued liabilities Accrued income taxes Long-term debt due within one year Obligations under capital leases due within one year Current liabilities of discontinued operations Total current liabilities Long-term debt Long-term obligations under capital leases Deferred income taxes and other Redeemable non-controlling interest Commitments and contingencies Shareholders equity: Common stock Capital in excess of par value Retained earnings Accumulated other comprehensive income (loss) Total Walmart shareholders' equity % Increase Increase (Decrease) (Decrease) 2015 2014 $9,135 6,778 45,141 2,224 0 $63,278 177,395 (63,115) 114,280 5,239 (2,864) 2,375 18,102 5,671 $203,706 $7,281 6,677 44,858 1,909 460 $61,185 173,089 (57,725) 115,364 5,589 (3,046) 2,543 19,510 6,149 $204,751 $1,854 $101 $283 $315 $460 $2,093 $4,306 $5,390 $1,084 $350 $182 $168 $1,408 $478 $1,045 25.46% 1.51% 0.63% 16.50% 100.00% 3.42% 2.49% 9.34% 0.94% 6.26% 5.98% 6.61% 7.22% 7.77% 0.51% $1,592 38,410 19,152 1,021 4,810 287 0 65,272 41,086 2,606 8,805 0 0 $7,670 37,415 18,793 966 4,103 309 89 69,345 41,771 2,788 8,017 1,491 0 $6,078 $995 $359 $55 $707 $22 $89 $4,073 $685 $182 $788 $1,491 $0 79.24% 2.66% 1.91% 5.69% 17.23% 7.12% 100.00% 5.87% 1.64% 6.53% 9.83% 100.00% 0.00% 323 2,462 85,777 (7,168) 81,394 323 2,362 76,566 (2,996) 76,255 $0 $100 $9,211 $4,172 $5,139 0.00% 4.23% 12.03% 139.25% 6.74% Noncontrolling interest Total equity Total liabilities and shareholders equity 4,543 85,937 $203,706 5,084 81,339 $204,751 $541 $4,598 $1,045 10.64% 5.65% 0.51% WAL MART STORES INC Vertical Analysis Income Statement (Amounts in millions except per share data) Fiscal Year Ended January 31, 2015 % Revenues: Net sales Membership and other income ### 99.30% 3,422 0.71% 485,651 100.00% 365,086 75.17% Operating, selling, general and administrative expenses 93,418 19.24% Operating income 27,147 5.59% 2,161 0.44% 300 0.06% Interest expense 2,461 0.51% Interest income (113) 0.02% Interest, net 2,348 0.48% Income from continuing operations before income taxes 24,799 5.11% Current 8,504 1.75% Deferred (519) 0.11% Total provision for income taxes 7,985 1.64% Income from continuing operations 16,814 3.46% 285 0.06% 17,099 3.52% (736) 0.15% $16,363 3.37% Costs and expenses: Cost of sales Interest: Debt Capital leases Provision for income taxes: Income (Loss) from discontinued operations, net of tax Consolidated net income Consolidated net income attributable to noncontrolling interest Consolidated net income attributable to Walmart Balance Sheet January 31, 2015 % Cash and cash equivalents $9,135 4.48% Receivables 6,778 3.33% Inventories 45,141 22.16% Prepaid expenses and other 2,224 1.09% 0 0.00% Total current assets $63,278 31.06% Property and equipment, at cost 177,395 87.08% Less accumulated depreciation (63,115) -30.98% Property and equipment, net 114,280 56.10% Property under capital lease 5,239 2.57% Less accumulated amortization (2,864) -1.41% Property under capital lease, net 2,375 1.17% Goodwill 18,102 8.89% Other assets and deferred charges 5,671 2.78% ### 100.00% Short-term borrowings $1,592 0.78% Accounts payable 38,410 18.86% Accrued liabilities 19,152 9.40% Accrued income taxes 1,021 0.50% Long-term debt due within one year 4,810 2.36% 287 0.14% 0 0.00% Total current liabilities 65,272 32.04% Long-term debt 41,086 20.17% Long-term obligations under capital leases 2,606 1.28% Deferred income taxes and other 8,805 4.32% Redeemable non-controlling interest 0 0.00% Commitments and contingencies 0 0.00% 323 0.16% Capital in excess of par value 2,462 1.21% Retained earnings 85,777 42.11% Accumulated other comprehensive income (loss) (7,168) -3.52% Total Walmart shareholders' equity 81,394 39.96% Noncontrolling interest 4,543 2.23% ASSETS Current assets: Current assets of discontinued operations Total assets LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities: Obligations under capital leases due within one year Current liabilities of discontinued operations Shareholders equity: Common stock Total equity Total liabilities and shareholders equity 85,937 42.19% ### 100.00% WAL MART STORES INC 2015 FORMULA Working Ratio Current Assets/Current liabilities 63278/65272 0.969 Quick Assets/Current liabilities 15913/65272 0.244 Total Debt/Total Equity 117769/81394 1.447 Total liabilities/Total assets 117769/203706 0.578 Net Income/Sales 17099/485651 3.52% Net Income/Total Assets Net Income/ Shareholders equity Net Income/Np. Of Equity Shares 17099/203706 8.39% 17099/81394 21.01% 16363/3228 5.07 Sales/Inventory 482229/45161 10.68 Sales/Accounts Receivable 482229/6778 71.15 Total Revenue/Total assets 485651/203706 2.38 1. Liquidity Ratios a) Current Ratio b) Quick Ratio 2.Solvency Ratio a) Debt Equity Ratio b) Debt to total assets 3. Profitability Ratios a) Profit Margin Ratio b) Return on Assets (ROA) c) Return on Equity (ROE) d0 EPS 4. Stock Performance Analysis a) Inventory Turnover b) Receivables Turnover c) Asset Turnover Liquidity Ratios Solvency Ratios Profitability Ratios Stock Ratios Dupont Current ratio Debt to equity Asset turnover Book value per common share Return on assets (calculated) Working capital Interest coverage Return on sales Earnings per share (basic) Return on sales Acid-test ratio Long term liabilities Gross margin % Earnings per share (diluted) Asset turnover Inventory turnover (times) Return on assets P/E Ratio Product Days sales in inventory Return on equity Dividend yield counts receivable turnover (times) Average interest rate Dividend payout Days sales in receivables Average total assets Book value of equity Free cash flow Income tax rateCommon shares outstanding (millions) Net of tax interest expense Adjusted closing price Average inventory Adjusted net income Dividends per share Average A/R Average equity Average total liabilities Fiscal Year Ended January 31, Revenues: Net sales Membership and other income WAL MART STORES INC 10-K Income Statement (Amounts in millions except per share data) 2015 2014 Costs and expenses: Cost of sales Operating, selling, general and administrative expenses Operating income Interest: Debt Capital leases Interest expense Interest income Interest, net Income from continuing operations before income taxes Provision for income taxes: Current Deferred Total provision for income taxes Income from continuing operations Income (Loss) from discontinued operations, net of tax Consolidated net income Consolidated net income attributable to noncontrolling interest Consolidated net income attributable to Walmart $482,229 $473,076 3,422 3,218 485,651 476,294 365,086 93,418 27,147 358,069 91,353 26,872 2,161 300 2,461 (113) 2,348 24,799 2,072 263 2,335 (119) 2,216 24,656 8,504 (519) 7,985 16,814 285 17,099 (736) 8,619 (514) 8,105 16,551 144 16,695 (673) $16,363 $16,022 Net income per common share: Basic income per common share from continuing operations to Walmart Basic income (loss) per common share from discontinued operations $5.01 $0.06 $4.87 $0.03 Basic net income per common share attributable to Walmart $5.07 $4.90 Diluted income per common share from continuing operations to Walmart Diluted income (loss) per common share from discontinued operations $4.99 $0.06 $4.85 $0.03 Diluted net income per common share $5.05 $4.88 Weighted-average number of common shares: Basic Diluted Dividends declared per common share 3,230 3,243 $1.92 3,269 3,283 $1.88 WAL MART STORES INC 10-K Balance Sheet (Amounts in millions except per share data) January 31, 2015 2014 ASSETS Current assets: Cash and cash equivalents $9,135 $7,281 Receivables 6,778 6,677 Inventories 45,141 44,858 Prepaid expenses and other 2,224 1,909 Current assets of discontinued operations 0 460 Total current assets $63,278 $61,185 Property and equipment, at cost Less accumulated depreciation Property and equipment, net 177,395 (63,115) 114,280 173,089 (57,725) 115,364 Property under capital lease Less accumulated amortization Property under capital lease, net 5,239 (2,864) 2,375 5,589 (3,046) 2,543 Goodwill Other assets and deferred charges 18,102 5,671 19,510 6,149 $203,706 $204,751 Total assets LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities: Short-term borrowings $1,592 Accounts payable 38,410 Accrued liabilities 19,152 Accrued income taxes 1,021 Long-term debt due within one year 4,810 Obligations under capital leases due within one ye 287 Current liabilities of discontinued operations 0 $7,670 37,415 18,793 966 4,103 309 89 Total current liabilities 65,272 69,345 Long-term debt Long-term obligations under capital leases Deferred income taxes and other Redeemable non-controlling interest Commitments and contingencies 41,086 2,606 8,805 0 0 41,771 2,788 8,017 1,491 0 Shareholders equity: Common stock Capital in excess of par value Retained earnings Accumulated other comprehensive income (loss) 323 2,462 85,777 (7,168) 323 2,362 76,566 (2,996) Total Walmart shareholders' equity 81,394 76,255 Noncontrolling interest 4,543 5,084 Total equity 85,937 81,339 $203,706 $204,751 Total liabilities and shareholders equity WAL MART STORES INC Horizontal Analysis Income Statement (Amounts in millions except per share data) Fiscal Year Ended January 31, Revenues: Net sales Membership and other income Increase % Increase (Decrease) (Decrease) 2015 Total Revenue 2014 $482,229 3,422 485,651 $473,076 3,218 476,294 $9,153 $204 $9,357 1.93% 6.34% 1.96% 358,069 91,353 26,872 $7,017 $2,065 $275 1.96% 2.26% 1.02% 2,072 263 2,335 (119) 2,216 24,656 $89 $37 $126 $6 $132 $143 4.30% 14.07% 5.40% 5.04% 5.96% 0.58% 8,619 (514) 8,105 16,551 144 16,695 (673) $16,022 $115 $5 $120 $263 $141 $404 $63 $341 1.33% 0.97% 1.48% 1.59% 97.92% 2.42% 9.36% 2.13% Costs and expenses: Cost of sales 365,086 Operating, selling, general and administrative expense 93,418 Operating income 27,147 Interest: Debt 2,161 Capital leases 300 Interest expense 2,461 Interest income (113) Interest, net 2,348 Income from continuing operations before income taxe 24,799 Provision for income taxes: Current 8,504 Deferred (519) Total provision for income taxes 7,985 Income from continuing operations 16,814 Income (Loss) from discontinued operations, net of tax 285 Consolidated net income 17,099 Consolidated net income attributable to noncontrolling (736) Consolidated net income attributable to Walmart $16,363 Balance Sheet Horizontal Analysis (Amounts in millions except per share data) January 31, ASSETS Current assets: Cash and cash equivalents Receivables Inventories Prepaid expenses and other Current assets of discontinued operations Total current assets Property and equipment, at cost Less accumulated depreciation Property and equipment, net Property under capital lease Less accumulated amortization Property under capital lease, net Goodwill Other assets and deferred charges Total assets LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities: Short-term borrowings Accounts payable Accrued liabilities Accrued income taxes Long-term debt due within one year Obligations under capital leases due within one year Current liabilities of discontinued operations Total current liabilities Long-term debt Long-term obligations under capital leases Deferred income taxes and other Redeemable non-controlling interest Commitments and contingencies Shareholders equity: Common stock Capital in excess of par value Retained earnings Accumulated other comprehensive income (loss) Total Walmart shareholders' equity % Increase Increase (Decrease) (Decrease) 2015 2014 $9,135 6,778 45,141 2,224 0 $63,278 177,395 (63,115) 114,280 5,239 (2,864) 2,375 18,102 5,671 $203,706 $7,281 6,677 44,858 1,909 460 $61,185 173,089 (57,725) 115,364 5,589 (3,046) 2,543 19,510 6,149 $204,751 $1,854 $101 $283 $315 $460 $2,093 $4,306 $5,390 $1,084 $350 $182 $168 $1,408 $478 $1,045 25.46% 1.51% 0.63% 16.50% 100.00% 3.42% 2.49% 9.34% 0.94% 6.26% 5.98% 6.61% 7.22% 7.77% 0.51% $1,592 38,410 19,152 1,021 4,810 287 0 65,272 41,086 2,606 8,805 0 0 $7,670 37,415 18,793 966 4,103 309 89 69,345 41,771 2,788 8,017 1,491 0 $6,078 $995 $359 $55 $707 $22 $89 $4,073 $685 $182 $788 $1,491 $0 79.24% 2.66% 1.91% 5.69% 17.23% 7.12% 100.00% 5.87% 1.64% 6.53% 9.83% 100.00% 0.00% 323 2,462 85,777 (7,168) 81,394 323 2,362 76,566 (2,996) 76,255 $0 $100 $9,211 $4,172 $5,139 0.00% 4.23% 12.03% 139.25% 6.74% Noncontrolling interest Total equity Total liabilities and shareholders equity 4,543 85,937 $203,706 5,084 81,339 $204,751 $541 $4,598 $1,045 10.64% 5.65% 0.51% WAL MART STORES INC Vertical Analysis Income Statement (Amounts in millions except per share data) Fiscal Year Ended January 31, 2015 % Revenues: Net sales Membership and other income ### 99.30% 3,422 0.71% 485,651 100.00% 365,086 75.17% Operating, selling, general and administrative expenses 93,418 19.24% Operating income 27,147 5.59% 2,161 0.44% 300 0.06% Interest expense 2,461 0.51% Interest income (113) 0.02% Interest, net 2,348 0.48% Income from continuing operations before income taxes 24,799 5.11% Current 8,504 1.75% Deferred (519) 0.11% Total provision for income taxes 7,985 1.64% Income from continuing operations 16,814 3.46% 285 0.06% 17,099 3.52% (736) 0.15% $16,363 3.37% Costs and expenses: Cost of sales Interest: Debt Capital leases Provision for income taxes: Income (Loss) from discontinued operations, net of tax Consolidated net income Consolidated net income attributable to noncontrolling interest Consolidated net income attributable to Walmart Balance Sheet January 31, 2015 % Cash and cash equivalents $9,135 4.48% Receivables 6,778 3.33% Inventories 45,141 22.16% Prepaid expenses and other 2,224 1.09% 0 0.00% Total current assets $63,278 31.06% Property and equipment, at cost 177,395 87.08% Less accumulated depreciation (63,115) -30.98% Property and equipment, net 114,280 56.10% Property under capital lease 5,239 2.57% Less accumulated amortization (2,864) -1.41% Property under capital lease, net 2,375 1.17% Goodwill 18,102 8.89% Other assets and deferred charges 5,671 2.78% ### 100.00% Short-term borrowings $1,592 0.78% Accounts payable 38,410 18.86% Accrued liabilities 19,152 9.40% Accrued income taxes 1,021 0.50% Long-term debt due within one year 4,810 2.36% 287 0.14% 0 0.00% Total current liabilities 65,272 32.04% Long-term debt 41,086 20.17% Long-term obligations under capital leases 2,606 1.28% Deferred income taxes and other 8,805 4.32% Redeemable non-controlling interest 0 0.00% Commitments and contingencies 0 0.00% 323 0.16% Capital in excess of par value 2,462 1.21% Retained earnings 85,777 42.11% Accumulated other comprehensive income (loss) (7,168) -3.52% Total Walmart shareholders' equity 81,394 39.96% Noncontrolling interest 4,543 2.23% ASSETS Current assets: Current assets of discontinued operations Total assets LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities: Obligations under capital leases due within one year Current liabilities of discontinued operations Shareholders equity: Common stock Total equity Total liabilities and shareholders equity 85,937 42.19% ### 100.00% WAL MART STORES INC 2015 FORMULA Working Ratio Current Assets/Current liabilities 63278/65272 0.969 Quick Assets/Current liabilities 15913/65272 0.244 Total Debt/Total Equity 117769/81394 1.447 Total liabilities/Total assets 117769/203706 0.578 Net Income/Sales 17099/485651 3.52% Net Income/Total Assets Net Income/ Shareholders equity Net Income/Np. Of Equity Shares 17099/203706 8.39% 17099/81394 21.01% 16363/3228 5.07 Sales/Inventory 482229/45161 10.68 Sales/Accounts Receivable 482229/6778 71.15 Total Revenue/Total assets 485651/203706 2.38 1. Liquidity Ratios a) Current Ratio b) Quick Ratio 2.Solvency Ratio a) Debt Equity Ratio b) Debt to total assets 3. Profitability Ratios a) Profit Margin Ratio b) Return on Assets (ROA) c) Return on Equity (ROE) d0 EPS 4. Stock Performance Analysis a) Inventory Turnover b) Receivables Turnover c) Asset Turnover Liquidity Ratios Solvency Ratios Profitability Ratios Stock Ratios Dupont Current ratio Debt to equity Asset turnover Book value per common share Return on assets (calculated) Working capital Interest coverage Return on sales Earnings per share (basic) Return on sales Acid-test ratio Long term liabilities Gross margin % Earnings per share (diluted) Asset turnover Inventory turnover (times) Return on assets P/E Ratio Product Days sales in inventory Return on equity Dividend yield counts receivable turnover (times) Average interest rate Dividend payout Days sales in receivables Average total assets Book value of equity Free cash flow Income tax rateCommon shares outstanding (millions) Net of tax interest expense Adjusted closing price Average inventory Adjusted net income Dividends per share Average A/R Average equity Average total liabilities