Based on the information contained in these financial statements (For Amazon use values for December 31, 2016 and for Wal-Mart use values for January 31, 2017.), determine the following values for each company. (Round all percentages to 1 decimal place, e.g. 17.5%.) (1) Profit margin for 2016. (For Amazon, use Total net sales.) (Show decrease with either a negative sign, e.g. -15.2% or in parentheses, e.g. (15.2)%.) (2) Gross profit for 2016. (Enter amounts in millions.) (3) Gross profit rate for 2016. (4) Operating income for 2016. (Enter amounts in millions.) (5) Percentage change in operating income from 2015 to 2016. (Show decrease with either a negative sign, e.g. -15.2% or in parentheses, e.g. (15.2)%.)

APPENDIX D D-2 Specimen Financial Statements: Amazon.com, Inc. AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) 2ingejd Year Ended December 31 2016 2015 2014 Net product sales Net service sales 94,665 79,268 70,080 $ 41,322 27,738 18,908 Total net sales 135,987 107,006 88,988 Operating expenses: Cost of sales 88,265 71,65 62,752 Fulfillment 17,619 13,410 10,766 Marketing 7,233 5,254 4,332 Technology and content 16,085 12,540 9,275 General and administrative 2,432 1,552 1.747 Other operating expense, net 133 167 171 Total operating expenses 104,773 88,810 131,801 Operating income Interest income 178 2,233 4,186 39 50 100 Interest expense (210) (459) (484) Other income (expense), net (118) (256) 90 Total non-operating income (expense) (289) (665) (294) Income (loss) before income taxes (111) 1,568 3,892 Provision for income taxes (167) (950) (1,425) Equity-method investment activity, net of tax 37 (22) (96) Net income (loss) (241) S 596 $ 2,371 Basic earnings per share (0.52) S 1.28 $ 5.01 Diluted earnings per share Weighted-average shares used in computation of earnings per share: S (0.52) S 1.25 $ 4.90 Basic 462 467 474 Diluted 462 477 484 See accompanying notes to consolidated financial statements. AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in millions) Year Ended December 31, 2014 2015 2016 Net income (loss) Other comprehensive income (loss): (241) $ 596 $ 2,371 Foreign currency translation adjustments, net of tax of $(3), S10, and S(49) (325) (210) (279) Net change in unrealized gains (losses) on available-for-sale securities: Unrealized gains (losses), net of tax of $1, $(5), and $(12) Reclassification adjustment for losses (gains) included in "Other income (expense), net," net of tax of S(1). $0, and $0 Net unrealized gains (losses) on available-for-sale securities 2 (7) (3) 8 (1) (326) (2) 17 Total other comprehensive income (loss) (212) (262) (567) S Comprehensive income (loss) 384 $ 2,109 See accompanying notes to consolidated financial statements D-4 APPENDIX D Specimen Financial Statements: Amazon.com, Inc. AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY b s(in millions) Common Stock Accumulated Additional Paid-In Capital Other Total Treasury Stock Retained Earnings Comprehensive Income (Loss) Stockholders' Shares Amount Equity Balance as of January 1, 2014 459 S 5 $ (1,837) $ 9,573 $ (185) $ 2,190 $ 9,746 Net loss (241) (241) Other comprehensive income (loss) (326) (326) Exercise of common stock options 6 2 Excess tax benefits from stock-based compensation 6 6 Stock-based compensation and issuance of employee benefit plan stock 1,510 1,510 Issuance of common stock for acquisition activity 44 44 Balance as of December 31, 2014 465 (1,837) 1,135 (511) 1,949 Net income 10,741 596 Other comprehensive income (loss) 596 (212) Exercise of common stock options (212) 6 4 Excess tax benefits from stock-based compensation Stock-based compensation and issuance of employee benefit plan stock Issuance of common stock for acquisition activity 4 119 119 2,131 2,13 5 Balance as of December 31, 2015 471 (1,837) 13,394 (723) Net income 2,545 13,384 2,371 Other comprehensive income (loss) 2,371 (262) Exercise of common stock options (262) 1 Excess tax benefits from stock-based compensation 829 Stock-based compensation and issuance of employee benefit plan stock 829 2,962 Balance as of December 31, 2016 5 $ (1,837)S 17,186 $ 477 $ 2,962 (985) $ 4,916 $ 19,285 See accompanying notes to consolidated financial statements Appendix Specimen Financial Statements: tho Wal-Mart Stores, Inc. hmleWedasud betbo eoontlo oioun The following are Wal-Mart Stores, Inc.'s financial statements as presented in the company's annual report for the year ended January 31, 2017. The complete annual report, including notes to the financial statements, is available at the company's website. d ds emleW o oldatudic to s n 2 moanto on S t siisha vensdasm Wal-Mart Stores, Inc. Consolidated Statement of Income deud Fiscal Years Ended January 31, (Amounts in millions, except per share data) 2017 2016 2015 Revenues: Net sales Membership and other income $481,317 $478,614 3,516 $482,229 3,422 4,556 Total revenues Costs and expenses: Cost of sales 485,873 482,130 485,651 Operating, selling, general and administrative expenses 361,256 101,853 360,984 97,041 365,086 93,418 Operating income Interest: Debt Capital lease and financing obligations Interest income 22,764 24,105 27,147 2,044 2,027 2,161 300 (113) 323 521 (100) (81) Interest, net 2,267 2,467 2,348 Income from continuing operations before income taxes Provision for income taxes 20,497 6,204 21,638 6,558 24,799 7,985 Income from continuing operations Income from discontinued operations, net of income taxes 14,293 15,080 16,814 285 Consolidated net income 14,293 (650) 17,099 (736) Consolidated net income attributable to noncontrolling interest 15,080 (386) Consolidated net income attributable to Walmart $ 13,643 S 14,694 $16,363 Basic net income per common share: Basic income per common share from continuing operations attributable to Walmart Basic income per common share from discontinued operations attributable to Walmart 4.40 4.58 5.01 0.06 Basic net income per common share attributable to Walmart $ 4.40 4.58 S 5.07 Diluted net income per common share: Diluted income per common share from continuing operations attributable to Walmart Diluted income per common share from discontinued operations attributable to Walmart 4.38 4.57 4.99 0.06 Diluted net income per common share attributable to Walmart S 4.38 457 $ 5.05 Weighted-average common shares outstanding: Basic Diluted 3,101 3,112 3,207 3,217 3,230 3,243 Dividends declared per common share $ 2.00 1.96 1.92 See accompanying notes E-1 PPENDIX E Specimen Financial Statements: Wal-Mart Stores, Inc. Wal-Mart Stores, Inc. Consolidated Statement of Comprehensive Income Fiscal Years Ended January 31, (Amounts in millions) 2015 2016 2017 Consolidated net income $15,080 (386) $17,099 (736) $14,293 (650) Less consolidated net income attributable to nonredeemable noncontrolling interest Consolidated net income attributable to Walmart 14,694 16,363 13,643 Other comprehensive income (loss), net of income taxes Currency translation and other Net investment hedges Cash flow hedges Minimum pension liability (2,882) (5,220) 366 (202) 86 (4,558) 379 (470) (69) 413 21 (397) Other comprehensive income (loss), net of income taxes Less other comprehensive income (loss) attributable to nonredeemable noncontrolling interest (2,845) (4,970) (4,718) 546 210 541 Other comprehensive income (loss) attributable to Walmart (2,635) (4,429) (4,172) Comprehensive income, net of income taxes Less comprehensive income (loss) attributable to nonredeemable noncontroiling interest 11,448 (440) 10,110 12,381 (190) 155 Comprehensive income attributable to Walmart $11,008 $10,265 $12,191 See accompanying notes Specimen Financial Statements: Wal-Mart Stores, Inc. Wal-Mart Stores, Inc. Consolidated Balance Sheets Couso As of January 31, (Amounts in millions) 2017 2016 ASSETS Current assets: Cash and cash equivalents Receivables, net Inventories $ 6,867 8,705 5,624 5,835 43,046 44469 Prepaid expenses and other 1,941 1,441 Total current assets 57,689 60,239 Property and equipment: Property and equipment Less accumulated depreciation 179,492 (71,782) 176,958 (66,787) Property and equipment, net Property under capital lease and financing obligations: Property under capital lease and financing obligations Less accumulated amortization 107,710 110,171 o 11,637 (5,169) 11,096 (4,751) Property under capital lease and financing obligations, net 6,468 17,037 6,345 Goodwill 16,695 Other assets and deferred charges 9,921 6,131 Total assets $198,825 $199,581 LIABILITIES AND EQUITY Current liabilities Short-term borrowings Accounts payable Accrued liabilities Accrued income taxes Long-term debt due within one year Capital lease and financing obligations due within one year 0 $ 1,099 S 2,708 38,487 EE 3e 41,433 20,654 19,607 921 521 2,256 2,745 565 551 Total current liabilities 66,928 64,619 Long-term debt Long-term capital lease and financing obligations Deferred income taxes and other 36,015 6,003 38,214 5,816 9,344 7,321 Commitments and contingencies Equity: Common stock 305 317 Capital in excess of par value Retained earnings Accumulated other comprehensive loss 1,805 2,371 89,354 90,021 (14,232) (11,597) Total Walmart shareholders' equity Nontedeemable noncontrolling interest 80,546 77,798 2,737 3,065 80,535 83,611 Total equity $199,581 $198,825 Total liabilities and equity See accompanying notes Specimen Financial Statements: Wal-Mart Stores, Inc. DIX E Wal-Mart Stores, Inc. Consolidated Statements of Shareholders' Equity and Redeemaole Noncontrolling Interest Accumulated Total Redeemable Nonredeemable Capital in Other Walmart Noncontrolling Comprehensive Shareholders Equity Total Noncontrolling Common Stock Excess of Retained Interest Equity Interest nounts in millions) Shares Amount Par Value Earnings Loss $ (2,996) $1,491 $323 $5,084 $81,339 17,099 alances as of February 1, 2014 onsolidated net income ther comprehensive loss, net of income taxes $2,362 $76,566 $76,255 16,363 3,233 736 16,363 (4,172) (546) (4,172) (4,718) ash dividends declared ($1.92 per share) urchase of Company stock (6,185) (950) (6,185) (6,185) (980) (1) (13) (29) (980) urchase of redeemable noncontrolling interest Other (1,491) 129 (17) (731) 113 (618) Balances as of January 31, 2015 3,228 323 2,462 7,168) 85,777 14,694 4,543 81,394 85,937 Consolidated net income 14,694 386 15,080 Other comprehensive loss, net of income taxes (4,429) (4,429) (541) (4,970) Cash dividends declared ($1.96 per share) Purchase of Company stock Cash dividend declared to noncontrolling interest (6,294) (6,294) (6,294) (65) (6) (102) (4,148) (4,256) (4,256) (691) (632) (691) (1,195) Other (1) (555) (8) (563) Balances as of January 31, 2016 3,162 317 1,805 90,021 (11,597) 80,546 3,065 83,611 Consolidated net income 13,643 13,643 650 14,293 Other comprehensive loss, net of income taxes Cash dividends declared (2,635) (2,635) (210) (2,845) ($2.00 per share) Purchase of Company stock Cash dividend declared to noncontrolling interest (6,216) (6,216) (8,276) (6,216) (120) (12) (174) (8,090) (8,276) (519) (519) Other 6 740 (4) 736 (249) 487 Balances as of January 31, 2017 3,048 $305 $2,371 $89,354 $(14,232) $77,798 $2,737 $80,535 See accompanying notes i T Specimen Financial Statements: Wal-Mart Stores, Inc. Appendix Wal-Mart Stores, Inc. Consolidated Statements of Cash Flow (Amounts in millions) Fiscal Years Ended January 31, 2017 Cash flows from operating activities: Consolidated net income Income from discontinued operations, net of income taxes 2016 2015 nclal Statements: 14,293 $15,080 $ 17,099 Income from continuing operations Adjustments to reconcile income from continuing operations to net cash provided by operating activities: Depreciation and amortization Deferred income taxes (285) 14,293 15,080 16,814 10,080 9454 9,173 (503) 785 761 Other operating activities Changes in certain assets and liabilities, net of effects of acquisitions: Receivables, net (672) 1,410 206 comoe (402) 1,021 3,942 (19) (703) 2,008 1,303 (472) (569) (1,229) 2,678 1,249 Inventories Accounts payable Accrued liabilities Accrued income taxes 1,137 492 166 Net cash provided by operating activities 31,530 27,389 28,564 Cash flows from investing activities: Payments for property and equipment Proceeds from the disposal of property and equipment Proceeds from the disposal of certain operations Purchase of available for sale securities Investment and business acquisitions, net of cash acquired Other investing activities (10,619) (11,477) (12,174) 456 635 570 662 246 671 (1,901) (2,463) (122) (79) (192) Net cash used in investing activities (13,987) (10,675) (11,125) Cash flows from financing activities: Net change in short-term borrowings Proceeds from issuance of long-term debt Payments of long-term debt Dividends paid Purchase of Company stock Dividends paid to noncontrolling interest Purchase of noncontrolling interest (1,673) 1,235 (6,288) 5,174 (3,904) (6,185) (1,015) 137 39 (2,055) (4,432) (6,294) (6,216) (8,298) (4,112) (719) (479) (600) (1,844) (409) (90) (1,326) Other financing activities (255) (513) Net cash used in financing activities (18,929) (16,122) (15,071) (514) (452) (1,022) Effect of exchange rates on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year 1,854 (1,838) (430) 7,281 8,705 9,135 $ 9,135 $ 8,705 6,867 Cash and cash equivalents at end of year Supplemental disclosure of cash flow information: income taxes paid Interest paid 8,111 2,540 8,169 4,507 2,433 2,351 See accompanying notes Specimen Financial Statements: Amazon.com, Inc. Amazon.com, Inc. is the world's largest online retailer. It also produces consumer electronics- notably the Kindle e-book reader and the Alexa digital assistant in its Echo speakers-and is a major provider of cloud computing services. The following are Amazon's financial statements as presented in the company's 2016 annual report. The complete annual report, including notes to the financial statements, is available at the company's website. AMAZON.COM, INC. LOCONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) Year Ended December 31, 2014 2015 2016 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 8,658 $ 14,557$ 15,890 OPERATING ACTIVITIES: Net income (loss) (241) 596 2,371 Adjustments to reconcile net income (loss) to net cash from operating activities Depreciation of property and equipment, including internal use soware and website development, and other amortization, including capitalizes conten cests Stock-based compensation di 4.746 6,281 8,116 2,119 1,497 2,975 Other operating expense, net 129 155 160 Other expense (income), net 59 250 (20) Deferred income taxes (316) 81 (246) Excess tax benefits from stock-based compensation (6) (119) (829) Changes in operating assets and liabilities: Inventories (1,193) (2,187) Accounts receivable, net and other (1,039) (1,755) (3,367) Accounts payable 1,759 4,294 5,030 Accrued expenses and other Additions to unearned revenue 706 913 1,724 4,433 7,401 11,931 Amortization of previously unearned revenue i (3,692) (6,109) (9,976) Net cash provided by (used in) operating activities 6,842 11,920 16,443 INVESTING ACTIVITIES: Purchases of property and equipment, including internal-use software and website (4,893) development, net Acquisitions, net of cash acquired, and other (4,589) (6,737) 12/9 (795) 0116) O 21 979) Sales and maturities of marketable securities 3,349 3,025 4,733 (2,542) (5,065) Purchases of marketable securities (4,091) (7,756) Net cash provided by (used in) investing activities (6,450) (9,876) FINANCING ACTIVITIES: Excess tax benefits from stock-based compensation 829 6 119 Proceeds from long-term debt and other 621 6,359 353 Repayments of long-term debt and other Principal repayments of capital lease obligations Principal repayments of finance lease obligations (1,652) (354) (513) (3,860) (1,285) (2,462) (121) (147) (135) Net cash provided by (used in) financing activities (3,763) (2,911) 4.432 Foreign currency effect on cash and cash equivalents Net increase (decrease) in cash and cash equivalents CASH AND CASH EQUIVALENTS, END OF PERIOD (212) (310) 5.899 (374) 1.333 3,444 19,334 14,557 $ 15,890 S SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for interest on long-term debt Cash paid for interest on capital and finance lease obligations Cash paid for income taxes, net of refunds Property and equipment acquired under capital leases Property and equipment acquired under build-to-suit leases 290 325 S 91 $ 206 153 86 273 412 177 4,717 5,704 4,008 1,209 544 920 See accompanying notes to consolidated financial statements D-3 Specimen Financial Statements: Amazon.com, Inc. AMAZON.COM, INC. CONSOLIDATED BALANCE SHEETS ontLE (in millions, except per share data) Sioen F December 31 2015 2016 ASSETS Current assets: Cash and cash equivalents 15,890 $ 19,334 Marketable securities 3,918 6,647 Inventories 10,243 11,461 Accounts receivable, net and other 5,654 8,339 Total current assets 35,705 45,781 Property and equipment, net 21,838 29,114 Goodwill 3,759 3,784 Other assets 3,445 4,723 Total assets 64,747 83,402 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 20,397 S 25,309 Accrued expenses and other 10,372 13,739 Unearned revenue 3,118 4,768 Total current liabilities 33,887 43,816 Long-term debt 8,227 7,694 Other long-term liabilities Commitments and contingencies (Note 7) Stockholders' equity: 9,249 12,607 Preferred stock, $0.01 par value: Authorized shares 500 Issued and outstanding shares Common stock, $0.01 par value: -none Authorized shares 5,000 Issued shares-494 and 500 Outstanding shares-471 and 477 5 5 Treasury stock, at cost (1,837) (1,837) 17,186 Additional paid-in capital Accumulated other comprehensive loss 13,394 (723) (985) Retained earnings 2,545 4,916 Total stockholders' equity Total liabilities and stockholders' equity 13,384 19,285 64,747 $ 83,402 See accompanying notes to consolidated financial statements