January 29, 2017 January 31, 2016 "Fiscal 2015" amounts in millions, except share and per share data "Fiscal 2016" ASSETS Current Assets: $ 2,538 $ 2,216 Cash and Cash Equivalents 1,890 Receivables, net 2,029 Merchandise Inventories 12,549 11,809 569 Other Current Assets 608 17,724 Total Current Assets 16,484 Property and Equipment, 40,426 39,266 at cost 18,512 Less Accumulated Depreciation and Amortization Net Property and Equipment 17,075 21,914 22,191 2,102 Goodwill 2,093 Other Assets 1,235 1,196 Total Assets $42,966 $41,973 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: $ 710 $ 350 Short-Term Debt Accounts Payable Accrued Salaries and Related Expenses Sales Taxes Payable 7,000 6,565 1,484 1,515 508 476 Deferred Revenue 1,669 1,566 Income Taxes Payable Current Installments of Long-Term Debt Other Accrued Expenses 25 34 542 77 2,195 1,941 Total Current Liabilities 14,133 12,524 Long-Term Debt, excluding current installments 22,349 20,789 Other Long-Term Liabilities 1,855 1,965 Deferred Income Taxes 296 38,633 379 Total Liabilities 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 January 31, 2016; outstanding: 1.203 billion shares at January 29, 2017 and 1.252 billion shares at January 31, 2016 88 88 Paid-in Capital Retained Earnings 9,787 9,347 35,519 30,973 (867) Accumulated Other Comprehensive Loss Treasury Stock, at cost, 573 million shares at January 29, 2017 and 520 million shares at January 31, 2016 Total Stockholders' Equity (898) (40,194) (33,194) 4,333 6,316 $42,966 Total Liabilities and Stockholders' Equity $41,973 Fiscal Year Ended( Jan. 31, 2016 "Fiscal 2015" Jan. 29, 2017 "Fiscal 2016" Feb. 1, 2015 "Fiscal 2014" amounts in millions, except per share data $94,595 $88,519 $83,176 NET SALES Cost of Sales 58,254 62,282 54,787 30,265 GROSS PROFIT 32,313 28,389 Operating Expenses Selling, General and Administrative 17,132 16,280 16,801 Depreciation and Amortization Total Operating Expenses 1,754 1,690 1,640 18,886 18,491 17,920 10,469 OPERATING INCOME 13,427 11,774 Interest and Other (Income) Expense: (337) Interest and Investment Income (36) (166) Interest Expense 972 919 830 Interest and Other, net 936 753 493 11,021 9,976 EARNINGS BEFORE PROVISION FOR INCOME TAXES 12,491 Provision for Income Taxes 4,534 4,012 3,631 $ 7,009 $ 6,345 7,957 NET EARNINGS Weighted Average Common Shares 1,229 1,277 1,338 $ 5.49 $ $4.74 BASIC EARNINGS PER SHAR .47 Diluted Weighted Average Common Shares 1,234 1,283 1,346 $ 4.71 DILUTED EARNINGS PER SHARE 6.45 5.46 (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. 31,2016 "Fiscal 2015" Jan. 29, 2017 Feb. 1, 2015 amounts in millions "Fiscal 2016" "Fiscal 2014" Net Earnings $7,957 $7,009 $6,345 Other Comprehensive Income (Loss) Foreign Currency Translation Adjustments Cash Flow Hedges, net of tax (3) (412) (510) 34 (34) 11 Other 1 (446 Total Other Comprehensive Income (Loss) 31 (498) January 29, 2017 January 31, 2016 "Fiscal 2015" amounts in millions, except share and per share data "Fiscal 2016" ASSETS Current Assets: $ 2,538 $ 2,216 Cash and Cash Equivalents 1,890 Receivables, net 2,029 Merchandise Inventories 12,549 11,809 569 Other Current Assets 608 17,724 Total Current Assets 16,484 Property and Equipment, 40,426 39,266 at cost 18,512 Less Accumulated Depreciation and Amortization Net Property and Equipment 17,075 21,914 22,191 2,102 Goodwill 2,093 Other Assets 1,235 1,196 Total Assets $42,966 $41,973 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: $ 710 $ 350 Short-Term Debt Accounts Payable Accrued Salaries and Related Expenses Sales Taxes Payable 7,000 6,565 1,484 1,515 508 476 Deferred Revenue 1,669 1,566 Income Taxes Payable Current Installments of Long-Term Debt Other Accrued Expenses 25 34 542 77 2,195 1,941 Total Current Liabilities 14,133 12,524 Long-Term Debt, excluding current installments 22,349 20,789 Other Long-Term Liabilities 1,855 1,965 Deferred Income Taxes 296 38,633 379 Total Liabilities 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 January 31, 2016; outstanding: 1.203 billion shares at January 29, 2017 and 1.252 billion shares at January 31, 2016 88 88 Paid-in Capital Retained Earnings 9,787 9,347 35,519 30,973 (867) Accumulated Other Comprehensive Loss Treasury Stock, at cost, 573 million shares at January 29, 2017 and 520 million shares at January 31, 2016 Total Stockholders' Equity (898) (40,194) (33,194) 4,333 6,316 $42,966 Total Liabilities and Stockholders' Equity $41,973 Accumulated Other Treasury Stock Common Stock Stockholders Paid-In Retained Comprehensive amounts in millions, except per share data Shares Amount Capital Earnings Income (Loss) Shares Amount Equity $88 $8,402 $23,180 46 (381) $(19,194) $12,522 Balance, February 2, 2014 1,761 Net Earnings 6,345 6,345 Shares Issued Under Employee Stock Plans 7 122 122 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 (80) (7,000) (7,000) Cash Dividends ($1.88 per share) (2,530) (2,530) Other 1 $88 $8,885 $26,995 $(452) (461) $(26,194) 9,322 Balance, February 1, 2015 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) 244 Stock Options, Awards and Amortization of Restricted Stock 244 Repurchases of Common Stock (7,000) (59) (7,000) Cash Dividends ($2.36 per share) (3,031) (3,031) $(898) $88 $9,347$30,973 (520) $(33,194) Balance, January 31, 2016 1,772 6,316 Net Earnings 7,957 7,957 Shares Issued Under Employee Stock Plans 76 76 Tax Effect of Stock-Based Compensation 97 97 (3) Foreign Currency Translation Adjustments (3) Cash Flow Hedges, net of tax 34 34 Stock Options, Awards and Amortization 267 267 of Restricted Stock (7,000) (7,000) Repurchases of Common Stock (53) Cash Dividends ($2.76 per share) (3,404) (3,404) Other (7) (7) $88 $9,787 $(867) (573) $(40,194) 4,333 Balance, January 29, 2017 1,776 $35,519 I|| | | | S3-1 Finding Financial Information [LO 3-1] Refer to the financlal statements of The Home Depot in Appendix A (Note: Flscal 2016 for The Home Depot runs from February 1, 2016, to January 29, 2017. As with many retall companles, The Home Depot labels the perlod "Fiscal 2016 even though It ends In the 2017 calendar year. The label "Fiscal 2016" Is approprlate because Fiscal 2016 Includes 11 months from the 2016 calendar year. The Home Depot explalns Its cholce of fiscal perlod In Note 1 to Its financlal statements.) Required: 1. How much dld The Home Depot's sales revenue Increase or decrease In the year ended January 29, 2017? Decreased $6,076 (mllion) Increased $6,076 (million) Decreased $948 (million) Increased $948 (millon) 2. What Is the largest expense on the Income statement for the year ended January 29, 2017, and how much did it change from the previous year? Cost of Sales, which Increased $4,028 (million) Selling, General and Administrative Expenses, which decreased $331 (million) Selling, General and Administrative Expenses, which increased $331 (million) Cost of Sales, whlch decreased $4,028 (million) 3. Which of the following was The Home Depot's net profit margin In the year ended January 29, 2017? $6.47 8.4% $7,957 34.2%