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Balance Sheet Equation and Financing Sources

Best Buys financial statements, dated February 2, 2019, report total assets of $12,901 million and total liabilities of $9,595 million.

a. Why might Best Buy have chosen February 2 as a yearend date? Using the drop-down menu next to each question, select "Yes" if the statement applies or "No" if it doesn't apply. AnswerYesNo

1. February is after the holiday season when sales are high. Best Buy wants to include those holiday sales in its results. AnswerYesNo

2. A nonDecember year end will help reduce federal income taxes. AnswerYesNo

3. In early February, inventory will be lower because of the holiday season sales and Best Buy can more easily (and inexpensively) count its inventory. AnswerYesNo

4. Other retailers pick late January or early February, and so there is an industry standard that Best Buy wants to use.

b. What is the amount of Best Buys equity at February 2, 2019? $Answer

million

c. Does Best Buy receive more financing from its owners or nonowners? AnswerOwnersNonowners

d. What percentage of financing is provided by Best Buys nonowners? Round answer to one decimal place (ex: 0.2345 = 23.5%). Answer

%

M1-24 Navigation Question 1Partially correctMark 6.00 out of 7.00 Not flaggedFlag question Question text Balance Sheet Equation and Financing Sources Best Buys financial statements, dated February 2, 2019, report total assets of $12,901 million and total liabilities of $9,595 million. a. Why might Best Buy have chosen February 2 as a yearend date? Using the drop-down menu next to each question, select "Yes" if the statement applies or "No" if it doesn't apply. Answer Yes 1. February is after the holiday season when sales are high. Best Buy wants to include those holiday sales in its results. Answer No 2. A nonDecember year end will help reduce federal income taxes. Answer Yes 3. In early February, inventory will be lower because of the holiday season sales and Best Buy can more easily (and inexpensively) count its inventory. Answer Yes 4. Other retailers pick late January or early February, and so there is an industry standard that Best Buy wants to use. b. What is the amount of Best Buys equity at February 2, 2019? $Answer 3,306 million c. Does Best Buy receive more financing from its owners or nonowners? Answer Nonowners d. What percentage of financing is provided by Best Buys nonowners? Round answer to one decimal place (ex: 0.2345 = 23.5%). Answer 0 %