CP8-2 Finding Financial Information LO8-1, 8-2, 8-6 Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. Year 2012.

Required:

1. What method of depreciation does the company use? "

2. What is the amount of accumulated depreciation and amortization at the end of the most recent reporting year?"

3. For depreciation purposes, what is the estimated useful life of furniture and fixtures? "

4. What was the original cost of leasehold improvements owned by the company at the end of the most recent reporting year?" "

5. What amount of depreciation and amortization was reported as expense for the most recent reporting year?"

6. What is the companys fixed asset turnover ratio for the most recent year?

What does it suggest?

URBAN OUTFITTERS, INC.

Consolidated Balance Sheets

(in thousands, except share and per share data)

January 31,

2012

2011

ASSETS

Current assets:

Cash and cash equivalents

$

145,273

$

340,257

Marketable securities

89,854

116,420

Accounts receivable, net of allowance for doubtful accounts of $1,614 and $1,015, respectively

36,673

36,502

Inventories

250,073

229,561

Prepaid expenses and other current assets

69,876

66,886

Deferred taxes

5,243

14,351

Total current assets

596,992

803,977

Property and equipment, net

684,979

586,346

Marketable securities

126,913

351,988

Deferred income taxes and other assets

74,824

52,010

Total Assets

$

1,483,708

$

1,794,321

LIABILITIES AND SHAREHOLDERS EQUITY

Current liabilities:

Accounts payable

$

95,754

$

82,904

Accrued compensation

15,630

20,212

Accrued expenses and other current liabilities

122,082

107,908

Total current liabilities

233,466

211,024

Deferred rent and other liabilities

183,974

171,749

Total Liabilities

417,440

382,773

Commitments and contingencies (see Note 12)

Shareholders equity:

Preferred shares; $.0001 par value, 10,000,000 shares authorized, none issued

Common shares; $.0001 par value, 200,000,000 shares authorized, 144,633,007 and 164,413,427 issued and outstanding, respectively

15

17

Additional paid-in capital

27,603

Retained earnings

1,077,765

1,394,190

Accumulated other comprehensive loss

(11,512

)

(10,262

)

Total Shareholders Equity

1,066,268

1,411,548

Total Liabilities and Shareholders Equity

$

1,483,708

$

1,794,321

URBAN OUTFITTERS, INC.

Consolidated Statements of Income

(in thousands, except share and per share data)

		Fiscal Year Ended January 31,
		2012				2011				2010
Net sales		$	2,473,801			$	2,274,102			$	1,937,815
Cost of sales, including certain buying, distribution and occupancy costs			1,613,265				1,337,482				1,151,670
Gross profit			860,536				936,620				786,145
Selling, general and administrative expenses			575,811				522,417				447,161
Income from operations			284,725				414,203				338,984
Interest income			5,120				4,669				6,290
Other income			553				486				463
Other expenses			(1,567	)			(2,150	)			(1,331	)
Income before income taxes			288,831				417,208				344,406
Income tax expense			103,580				144,250				124,513
Net income		$	185,251			$	272,958			$	219,893
Net income per common share:
Basic		$	1.20			$	1.64			$	1.31
Diluted		$	1.19			$	1.60			$	1.28
Weighted average common shares outstanding:
Basic			154,025,589				166,896,322				168,053,502
Diluted			156,191,289				170,333,550				171,230,245

The accompanying notes are an integral part of these consolidated financial statements.

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URBAN OUTFITTERS, INC.

Consolidated Statements of Shareholders Equity

(in thousands, except share data)

		Compre- hensive Income				Common Shares								Additional Paid-in Capital				Retained Earnings				Accumulated Other Compre- hensive Loss				Total
						Number of Shares				Par Value
Balances as of January 31, 2009							167,712,088			$	17			$	170,166			$	901,339			$	(17,747	)		$	1,053,775
Net income		$	219,893																219,893								219,893
Foreign currency translation			7,173																				7,173				7,173
Unrealized gains on marketable securities, net of tax			1,480																				1,480				1,480
Comprehensive income		$	228,546
Share-based compensation															4,766												4,766
Stock options and awards							846,283								3,250												3,250
Tax effect of share exercises															6,438												6,438
Balances as of January 31, 2010							168,558,371			$	17			$	184,620			$	1,121,232			$	(9,094	)		$	1,296,775
Net income		$	272,958																272,958								272,958
Foreign currency translation			(429	)																			(429	)			(429	)
Unrealized losses on marketable securities, net of tax			(739	)																			(739	)			(739	)
Comprehensive income		$	271,790
Share-based compensation															10,725												10,725
Stock options and awards							2,256,273								24,129												24,129
Tax effect of share exercises															12,847												12,847
Share Repurchases							(6,401,217	)							(204,718	)											(204,718	)
Balances as of January 31, 2011							164,413,427			$	17			$	27,603			$	1,394,190			$	(10,262	)		$	1,411,548
Net income		$	185,251																185,251								185,251
Foreign currency translation			(2,285	)																			(2,285	)			(2,285	)
Unrealized gains on marketable securities, net of tax			1,035																				1,035				1,035
Comprehensive income		$	184,001
Share-based compensation															3,068												3,068
Stock options and awards							993,923								4,134												4,134
Tax effect of share exercises															8,995												8,995
Share Repurchases							(20,774,343	)			(2	)			(43,800	)			(501,676	)							(545,478	)
Balances as of January 31, 2012							144,633,007			$	15			$				$	1,077,765			$	(11,512	)		$	1,066,268

The accompanying notes are an integral part of these consolidated financial statements.

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URBAN OUTFITTERS, INC.

Consolidated Statements of Cash Flows

(in thousands)

		Fiscal Year Ended January 31,
		2012				2011				2010
Cash flows from operating activities:
Net income		$	185,251			$	272,958			$	219,893
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			108,112				101,105				92,350
Provision for deferred income taxes			(12,150	)			(8,727	)			2,161
Excess tax benefit on share-based compensation			(8,995	)			(12,847	)			(6,438	)
Share-based compensation expense			3,068				10,725				4,766
Loss on disposition of property and equipment, net			857				119				339
Changes in assets and liabilities:
Receivables			(251	)			1,835				(1,825	)
Inventories			(20,817	)			(43,372	)			(15,544	)
Prepaid expenses and other assets			6,317				14,825				(25,619	)
Accounts payable, accrued expenses and other liabilities			21,310				48,492				55,311
Net cash provided by operating activities			282,702				385,113				325,394
Cash flows from investing activities:
Cash paid for property and equipment			(190,010	)			(143,642	)			(109,260	)
Cash paid for marketable securities			(169,467	)			(463,129	)			(806,546	)
Sales and maturities of marketable securities			414,769				571,236				421,040
Net cash provided by (used in) investing activities			55,292				(35,535	)			(494,766	)
Cash flows from financing activities:
Exercise of stock options			4,136				24,129				3,250
Excess tax benefit from stock option exercises			8,995				12,847				6,438
Share repurchases			(545,478	)			(204,718	)
Net cash (used in) provided by financing activities			(532,347	)			(167,742	)			9,688
Effect of exchange rate changes on cash and cash equivalents			(631	)			(603	)			2,673
(Decrease) increase in cash and cash equivalents			(194,984	)			181,233				(157,011	)
Cash and cash equivalents at beginning of period			340,257				159,024				316,035
Cash and cash equivalents at end of period		$	145,273			$	340,257			$	159,024
Supplemental cash flow information:
Cash paid during the year for:
Income taxes		$	120,847			$	121,341			$	137,490
Non-cash investing activitiesAccrued capital expenditures		$	21,955			$	8,077			$	12,960

The accompanying notes are an integral part of these consolidated financial statements.

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URBAN OUTFITTERS, INC.