Compute the following three ratios for The Home Depot's year ended January 29, 2017: (i) fixed asset turnover, (ii) days to sell, and (iii) debt-to-assets. To calculate the ratios, use the Fiscal 2016 financial statements of The Home Depot in Appendix A at the end of this book. (Note: Fiscal 2016 for The Home Depot runs from February 1, 2016, to January 29, 2017. As with many retail companies, The Home Depot labels the period "Fiscal 2016" even though it ends in the 2017 calendar year. The label Fiscal 2016" is appropriate because Fiscal 2016 includes 11 months from the 2016 calendar year. The Home Depot explains its choice of fiscal period in Note 1 to its financial statements.) (Use 365 days in a year. Round intermediate calculations to 2 decimal places. Round fixed asset turnover and debt-to-assets final ratios to 2 decimal places. Round days to sell ratio to 1 decimal place.) 2.37; 71.4; 0.90 2.37; 47.0; 0.52 O 4.29; 47.0; 0.90 4.29; 71.4; 0.90 APPENDIX A Excerpts from the Fiscal 2016 Annual Report of The Home Depot, Inc. A5 THE HOME DEPOT, INC. AND SUBSIDIARIES Consolidated Balance Sheets January 29, 2017 January 31, 2016 amounts in millions, except share and per share data "Fiscal 2016" "Fiscal 2015" ASSETS Current Assets: $ 2,216 $ 2,538 Cash and Cash Equivalents 1,890 Receivables, net 2,029 Merchandise Inventories 12,549 11,809 Other Current Assets 608 569 17,724 16,484 Total Current Assets Property and Equipment, at cost 40,426 39,266 Less Accumulated Depreciation and Amortization 18,512 17,075 Net Property and Equipment Goodwill 21,914 22,191 2,093 2,102 Other Assets 1,235 1,196 Total Assets $42,966 $41,973 LIABILITIES AND STOCKHOLDERS EQUITY Current Liabilities: $ 350 $ 710 Short-Term Debt 2$ Accounts Payable Accrued Salaries and Related Expenses 7,000 6,565 1,484 1,515 Sales Taxes Payable 508 476 Deferred Revenue 1,566 1,669 25 Income Taxes Payable Current Installments of Long-Term Debt Other Accrued Expenses 34 542 77 1,941 2,195 12.524 Total Current Liabilities 14,133 20,789 Long-Term Debt, excluding current installments 22,349 Other Long-Term Liabilities 1,855 1,965 Deferred Income Taxes 296 379 Total Liabilities 38,633 35,657 STOCKHOLDERS' EQUITY Common Stock, par value $0.05; authorized: 10 billion shares; issued: 1.776 billion shares at January 29, 2017 and 1.772 billion shares at 88 88 January 31, 2016; outstanding: 1.203 billion shares at January 29, 2017 and 1.252 billion shares at January 31, 2016 Paid-in Capital 9,787 9,347 Retained Earnings 35,519 30,973 Accumulated Other Comprehensive Loss (898) (867) (40,194) (33,194) Treasury Stock, at cost, 573 million shares at January 29, 2017 and 520 million shares at January 31, 2016 Total Stockholders' Equity 4,333 6,316 $42,966 $41,973 Total Liabilities and Stockholders' Equity See accompanying Notes to Consolidated Financial Statements. A6 APPENDIX A Excerpts from the Fiscal 2016 Annual Report of The Home Depot, Inc. THE HOME DEPOT, INC. AND SUBSIDIARIES Consolidated Statements of Earnings Fiscal Year Ended) Jan. 29, 2017 "Fiscal 2016" Jan. 31, 2016 Feb. 1, 2015 amounts in millions, except per share data "Fiscal 2015" "Fiscal 2014" $94,595 NET SALES $88,519 $83,176 Cost of Sales 62,282 58,254 54,787 32,313 30,265 28,389 GROSS PROFIT Operating Expenses: Selling, General and Administrative Depreciation and Amortization 17,132 16,801 16,280 1,754 18,886 1,690 1,640 17,920 Total Operating Expenses 18,491 11,774 OPERATING INCOME 13,427 10,469 Interest and Other (Income) Expense: (337) Interest and Investment Income (36) (166) Interest Expense 972 936 830 919 Interest and Other, net 753 493 EARNINGS BEFORE PROVISION FOR INCOME TAXES 12,491 11,021 9,976 Provision for Income Taxes 4,534 4,012 3,631 $ 7,957 $ 7.009 $ 6,345 NET EARNINGS Weighted Average Common Shares 1,229 1,277 1,338 $ 6.47 $ 5.49 $4.74 BASIC EARNINGS PER SHARE Diluted Weighted Average Common Shares 1,234 1,283 1,346 $ 6.45 $ 5.46 $ 4.71 DILUTED EARNINGS PER SHARE (1) Fiscal years ended January 29, 2017, January 31, 2016, and February 1, 2015 include 52 weeks. See accompanying Notes to Consolidated Financial Statements. THE HOME DEPOT, INC. AND SUBSIDIARIES Consolidated Statements of Comprehensive Income Fiscal Year Ended() Jan. 29, 2017 "Fiscal 2016" amounts in millions Jan. 31, 2016 Feb. 1, 2015 "Fiscal 2015" "Fiscal 2014" Net Earnings $7,957 $6,345 $7,009 Other Comprehensive Income (Loss): Foreign Currency Translation Adjustments (3) (412) (510) Cash Flow Hedges, net of tax 34 (34) 11 Other Total Other Comprehensive Income (Loss) 31 (446) (498) $7,988 COMPREHENSIVE INCOME $6,563 $5,847 (1) Fiscal years ended January 29, 2017, January 31, 2016, and February 1, 2015 include 52 weeks. See accompanying Notes to Consolidated Financial Statements. A7 APPENDIX A Excerpts from the Fiscal 2016 Annual Report of The Home Depot, Inc. THE HOME DEPOT, INC. AND SUBSIDIARIES Consolidated Statements of Stockholders' Equity Accumulated Other Treasury Stock Common Stock Paid-In Retained Comprehensive Stockholders' amounts in millions, except per share data Shares Amount Capital Earnings Income (Loss) Shares Amount Equity $ 46 $88 $8,402 $23,180 (381) $(19,194) $12,522 Balance, February 2, 2014 1,761 Net Earnings 6,345 6,345 Shares Issued Under Employee Stock Plans 122 122 Tax Effect of Stock-Based Compensation 136 136 Foreign Currency Translation Adjustments (510) (510) Cash Flow Hedges, net of tax 11 11 Stock Options, Awards and Amortization 225 225 of Restricted Stock Repurchases of Common Stock (7,000) (7,000) (80) Cash Dividends ($1.88 per share) (2,530) (2,530) Other 1 1 Balance, February 1, 2015 $ 9,322 $88 $8,885 $26,995 $(452) (461) $(26,194) 1,768 Net Earnings 7,009 7,009 Shares Issued Under Employee Stock Plans 73 73 Tax Effect of Stock-Based Compensation 145 145 Foreign Currency Translation Adjustments (412) (412) Cash Flow Hedges, net of tax (34) (34) Stock Options, Awards and Amortization of Restricted Stock 244 244 Repurchases of Common Stock (59) (7,000) (7,000) Cash Dividends ($2.36 per share) (3,031) (3,031) $ 6,316 1,772 $9,347 $30,973 Balance, January 31, 2016 $88 $(898) (520) $(33,194) Net Earnings 7,957 7,957 Shares Issued Under Employee Stock Plans 76 76 Tax Effect of Stock-Based Compensation 97 97 Foreign Currency Translation Adjustments (3) (3) Cash Flow Hedges, net of tax 34 34 Stock Options, Awards and Amortization 267 267 of Restricted Stock Repurchases of Common Stock (53) (7,000) (7,000) Cash Dividends ($2.76 per share) (3,404) (3,404) Other (7) (7) $ 4,333 $88 $9,787 $35,519 $(867) (573) $(40,194) Balance, January 29, 2017 1,776 See accompanying Notes to Consolidated Financial Statements. ||| A8 APPENDIX A Excerpts from the Fiscal 2016 Annual Report of The Home Depot, Inc. THE HOME DEPOT, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows Fiscal Year Ended Jan. 29, 2017 Jan. 31, 2016 Feb. 1, 2015 "Fiscal 2016" amounts in millions "Fiscal 2015" "Fiscal 2014" CASH FLOWS FROM OPERATING ACTIVITIES: Net Earnings $7,957 $7,009 $6,345 Reconciliation of Net Earnings to Net Cash Provided by Operating Activities: 1,973 Depreciation and Amortization 1,863 1,786 Stock-Based Compensation Expense 267 244 225 Gain on Sales of Investments (323) (144) Changes in Assets and Liabilities, net of the effects of acquisitions: Receivables, net (138) (181) (81) Merchandise Inventories (769) (546) (124) Other Current Assets (48) (5) (199) Accounts Payable and Accrued Expenses 446 888 244 Deferred Revenue 99 109 146 Income Taxes Payable 109 154 168 Deferred Income Taxes (117) 15 159 Other Net Cash Provided by Operating Activities (33) (104) 9,783 9,373 8,242 CASH FLOWS FROM INVESTING ACTIVITIES: Capital Expenditures, net of $179, $165 and $217 of non-cash capital expenditures in fiscal 2016, 2015 and 2014, respectively (1,621) (1,503) (1,442) Proceeds from Sales of Investments 144 323 Payments for Businesses Acquired, net Proceeds from Sales of Property and Equipment (200) (1,666) 38 (1,583) 43 48 Net Cash Used in Investing Activities (2,982) (1,271) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from Short-Term Borrowings, net 360 60 290 4,959 3,991 Proceeds from Long-Term Borrowings, net of discounts 1,981 (3,045) (39) Repayments of Long-Term Debt (39) Repurchases of Common Stock (6,880) (7,000) (7,000) Proceeds from Sales of Common Stock 218 228 252 (3,404) (3,031) Cash Dividends Paid to Stockholders (2,530) (25) (7,071) Other Financing Activities (78) (7,870) 4 Net Cash Used in Financing Activities (5,787) Change in Cash and Cash Equivalents 330 604 (100) Effect of Exchange Rate Changes on Cash and Cash Equivalents (8) (111) (106) Cash and Cash Equivalents at Beginning of Year 2,216 1,723 1,929 $1,723 Cash and Cash Equivalents at End of Year $2,538 $2,216 SUPPLEMENTAL DISCLOSURE OF CASH PAYMENTS MADE FOR: $ 924 $ 874 $ 782 Interest, net of interest capitalized $4,623 $3,853 $3,435 Income Taxes (1) Fiscal years ended January 29, 2017, January 31, 2016, and February 1, 2015 include 52 weeks. See accompanying Notes to Consolidated Financial Statements