Question
Hey Chegg, I need help with this question. If you can show me the steps to how you arrived with your answers, I would really
Hey Chegg, I need help with this question. If you can show me the steps to how you arrived with your answers, I would really appreciate it. Thank you for your help.
Question
Analysis and Interpretation of Profitability Balance sheets and income statements for Nordstrom, Inc., follow. Refer to these financial statements to answer the requirements.
Nordstrom, Inc. Consolidated Statements of Earnings | |||
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For Fiscal Years Ended ($ millions) | 2013 | 2012 | 2011 |
Net Sales | $11,762 | $10,497 | $9,310 |
Credit card revenues | 386 | 380 | 390 |
Total revenues | 12,148 | 10,877 | 9,700 |
Cost of sales and related buying and occupancy costs | (7,432) | (6,592) | (5,897) |
Selling, general and administrative expenses |
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|
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Retail | (3,166) | (2,807) | (2,412) |
Credit | (205) | (229) | (273) |
Earnings before interest and income taxes | 1,345 | 1,249 | 1,118 |
Interest expense, net | (160) | (130) | (127) |
Earnings before income taxes | 1,185 | 1,119 | 991 |
Income tax expense | (450) | (436) | (378) |
Net earnings | $ 735 | $ 683 | $ 613 |
Nordstrom, Inc. Consolidated Balance Sheets | ||
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($ millions) | February 2, 2013 | January 28, 2012 |
Assets |
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Current assets |
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Cash and cash equivalents | $ 1,285 | $ 1,877 |
Accounts receivable, net | 2,129 | 2,033 |
Merchandise inventories | 1,360 | 1,148 |
Current deferred tax assets, net | 227 | 220 |
Prepaid expenses and other | 80 | 282 |
Total current assets | 5,081 | 5,560 |
Land, buildings and equipment, net | 2,579 | 2,469 |
Goodwill | 175 | 175 |
Other assets | 254 | 287 |
Total assets | $ 8,089 | $ 8,491 |
Liabilities and equity |
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Current liabilities |
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Accounts payable | $ 1,011 | $ 917 |
Accrued salaries, wages and related benefits | 404 | 388 |
Other current liabilities | 804 | 764 |
Current portion of long-term debt | 7 | 506 |
Total current liabilities | 2,226 | 2,575 |
Long-term debt, net | 3,124 | 3,141 |
Deferred income taxes and other liabilities | 485 | 500 |
Other liabilities | 341 | 319 |
Shareholders equity |
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Common stock, no par value: 1,000 shares authorized; | 1,645 | 1,484 |
197.0 and 207.6 shares issued and outstanding |
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Retained earnings | 315 | 517 |
Accumulated other comprehensive loss | (47) | (45) |
Total shareholders equity | 1,913 | 1,956 |
Total liabilities and shareholders equity | $ 8,089 | $ 8,491 |
(a) Compute net operating profit after tax (NOPAT) for 2013. Assume that the combined federal and state statutory tax rate is 37%. (Round to the nearest whole number.) 2013 NOPAT = $Answer (b) Compute net operating assets (NOA) for 2013 and 2012. 2013 NOA = $Answer 2012 NOA = $Answer (c) Compute RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2013. Do not use NOPM x NOAT to calulate RNOA. (Do not round until your final answer. Round answer to two decimal places.) 2013 RNOA = Answer% 2013 NOPM = Answer% 2013 NOAT = Answer (d) Compute net nonoperating obligations (NNO) for 2013 and 2012. 2013 NNO = $Answer 2012 NNO = $Answer (e) Compute return on equity (ROE) for 2013. (Round answer to two decimal places.) 2013 ROE = Answer% (f) Infer the nonoperating return component of ROE for 2013. (Use above answers to calculate. Round answer to two decimal places.) 2013 nonoperating return = Answer%
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