Question
Can you please Help me find the answer to this question? Thank you very much Using the financial ratios provided in Table 4.1 and the
Can you please Help me find the answer to this question? Thank you very much
Using the financial ratios provided in Table 4.1 and the financial statement information presented below for Costco Wholesale Corporation, calculate the following ratios for Costco for both 2013 and 2014:
Gross profit margin
Operating profit margin
Net profit margin
Times-interest-earned (or coverage) ratio
Return on stockholders equity
Return on assets
Debt-to-equity ratio
Days of inventory
Inventory turnover ratio
Average collection period
Based on these ratios, did Costcos financial performance improve, weaken, or remain about the same from 2013 to 2014?
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Consolidated Income Statements for Costco Wholesale Corporation, 20132014 (in millions, except per share data)
2014 2013
Net sales $110,212 $102,870
Membership fees 2,428 2,286
Total revenue 112,640 105,156
Merchandise costs 98,458 $91,948
Selling, general, and administrative 10,899 10,155
Operating income 3,220 3,053
Other income (expense)
Interest expense
(113) (99)
Interest income and other, net
90 97
Income before income taxes 3,197 3,051
Provision for income taxes 1,109 990
Net income including noncontrolling interests 2,088 2,061
Net income attributable to noncontrolling interests (30) (22)
Net income $2,058 $2,039
Basic earnings per share
$4.69 $4.68
Diluted earnings per share
$4.65 $4.63
Source: Costco Wholesale Corporation 2014 10-K.
Consolidated Balance Sheets for Costco Wholesale Corporation, 20132014 (in millions, except per share data)
August 31,2014 September 1, 2013
Assets
Current Assets
Cash and cash equivalents $5,738 $4,644
Short-term investments 1,577 1,480
Receivables, net 1,148 1,026
Merchandise inventories 8,456 7,894
page 116Deferred income taxes and other current assets 669 621
Total current assets 17,588 $15,840
Property and Equipment
Land $4,716 $4,409
Buildings and improvements 12,522 11,556
Equipment and fixtures 4,845 4,472
Construction in progress 592 585
22,675 21,022
Less accumulated depreciation and amortization (7,845) (7,141)
Net property and equipment 14,830 13,881
Other assets 606 562
Total assets $33,024 $30,283
Liabilities and Equity
Current Liabilities
Accounts payable $8,491 $7,872
Accrued salaries and benefits 2,231 2,037
Accrued member rewards 773 710
Accrued sales and other taxes 442 382
Deferred membership fees 1,254 1,167
Other current liabilities 1,221 1,089
Total current liabilities 14,412 13,257
Long-term debt, excluding current portion 5,093 4,998
Deferred income taxes and other liabilities 1,004 1,016
Total liabilities 20,509 $19,271
Commitments and Contingencies
Equity
Preferred stock $0.005 par value; 100,000,000 shares authorized; no shares issued and outstanding 0 0
Common stock $0.005 par value; 900,000,000 shares authorized; 436,839,000 and 432,350,000 shares issued and outstanding 2 2
Additional paid-in capital $4,919 $4,670
Accumulated other comprehensive (loss) income (76) (122)
Retained earnings 7,458 6,283
Total Costco stockholders equity 12,303 10,833
Noncontrolling interests 212 179
Total equity 12,515 11,012
Total Liabilities and Equity
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