BED BATH & BEYOND INC. AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands, except per share data)

		March 3, 2018				February 25, 2017
Assets
Current assets:
Cash and cash equivalents		$	346,140			$	488,329
Short term investment securities			378,039				-
Merchandise inventories			2,730,874				2,905,660
Prepaid expenses and other current assets			516,025				197,912
Total current assets			3,971,078				3,591,901

Pier 1 Imports, Inc.

CONSOLIDATED BALANCE SHEETS

(in thousands except share amounts)

		March 3, 2018				February 25, 2017
ASSETS
Current assets:
Cash and cash equivalents, including temporary investments of $115,456 and $149,375, respectively		$	135,379			$	154,460
Accounts receivable, net of allowance for doubtful accounts of $236 and $338, respectively			22,149				22,945
Inventories			347,440				400,976
Prepaid expenses and other current assets			48,794				31,607
Total current assets			553,762				609,988
Properties and equipment, net			178,767				191,476
Other noncurrent assets			39,790			41,618
		$	772,319			$	843,082

c. Compute the average days inventory outstanding for the current and past year for each company and show your calculations. Review pages 6-12 and 6-13, which shows the formula as 365 times Average Inventory/ Cost of Goods Sold. To determine the average inventory use the current year and past year inventory divided by 2, since the ending inventory of one year is the beginning inventory of the next year. Cost of Goods Sold is the same thing as Cost of Sales. Round to the nearest day. You can find this information on the current 10-K except for the following information for 2016 Inventory for BBBY $2,848,119 thousand and PIR $405,859 thousand. Comment on your results including a comparison of the two companies. You must show your work to earn full credit.

	Current year	Past year
BBBY
PIR

Comments:

d. Does the company face any inventory related risk? You need to use the 10-K Part 1A Risk Factors for both companies and find at least one risk factor that relates to inventory. Comment on the risk factor you picked for each company. Provide the page number that you are referencing in this question.

e. Compute Days Payable Outstanding (DPO) for the current and past year for each company and show your calculations. Review page 6-14, which shows the formula as 365 times Average Accounts Payable/Cost of Goods Sold. Cost of Goods Sold is the same thing as Cost of Merchandise Sold. Round to the nearest day. You can find this information on the current 10-K except for the following information for 2016 Accounts Payable for BBBY $1,100,958 thousand and PIR $72,570 thousand. Comment on your results including a comparison of the two companies. You must show your work to earn full credit.

Round to the nearest day.	Current	Past year
BBBY
PIR

Comment: