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Need help solving for this problem: Question 6 Partially correct Mark 0.55 out of 3.00 p Flag question 78 Analysis and Interpretation of Profitability Balance

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Question 6 Partially correct Mark 0.55 out of 3.00 p Flag question 78 Analysis and Interpretation of Profitability Balance sheets and income statements for Best Buy Co., Inc. follow. Consolidated Statements of Earnings For Fiscal Years Ended (5 millions) February 27, 2010 February 28, 2009 March 1, 2008 Revenue $ 49.694 $ 45,015 $ 40,023 Cost of goods sold 37.534 34,017 30,477 Restructuring charges - cost of goods sold Gross Profit 12.160 10.998 9,546 Selling, general and administrative expenses 9,873 8.984 7.385 Restructuring charges 52 Goodwill and tradename impairment Operating income 2.235 1,870 2,161 Other income (expense) Investment income and other 129 Investment impairment (111) Interest expense (94) (94) (62) Earnings before income tax expense and equity in income of affiliates 2,195 1,700 2.228 Income tax expense 674 815 Equity in income of affiliates (3) Net earnings including noncontrolling interest 1,394 1,033 1,410 Net income attributable to noncontrolling interest (77) (30) (3) Net income attributable to Best Buy Co., Inc. 5 1.317 51,003 $1,407 66 54 35 802 1 7 Consolidated Balance Sheets ($ millions, except footnotes) February 27, 2010 February 28, 2009 Assets Current assets Cash and cash equivalents 5 1,826 $ 498 Short-term investments 90 11 Receivables 2,020 1,868 Merchandise inventories 5,486 4,753 Other current assets 1.144 1,062 Total current assets 10.566 8,192 Property and equipment Land and buildings 757 755 Leasehold improvements 2,154 2,013 Fixtures and equipment 4,447 4,060 Property under capital lease 95 112 7,453 6,940 Less: Accumulated depreciation 3,383 2.766 Property and equipment, net 4,070 4.174 Goodwill 2,452 2,203 Tradenames, net 159 173 Customer relationships, net 279 322 Equity and other investments 324 395 Other noncurrent assets 452 367 Total assets $ 18,302 $ 15,826 Liabilities and equity Current liabilities Accounts payable $5,276 $4.997 Unredeemed gift card liabilities 463 479 Accrued compensation and related expenses 544 459 Accrued liabilities 1,681 1,382 Accrued income taxes 316 281 Short-term debt 663 783 Current portion of long-term debt 35 54 Total current liabilities 8.978 8,435 Long-term liabilities 1,256 1.109 Long-term debt 1,104 1.126 Equity Best Buy Co., Inc. Shareholders' equity Preferred stock, $1.00 par value Common stock $0.10 par value 42 41 Additional paid-in capital 441 205 Retained earnings 5,797 4,714 Accumulated other comprehensive income (loss) 40 (317) Total Best Buy Co., Inc. shareholders' equity 6.320 4.643 Noncontrolling interest 644 513 Total equity 6,964 5,156 Total liabilities and equity 5 18,302 $ 15,826 (a) Compute net operating profit after tax (NOPAT) for 2010. Assume that the combined federal and statutory rate is: 37.0%. (Hint: Treat equity in income of affiliates as operating. Round your answer to the nearest whole number.) 2010 NOPAT = 1,409 x ($ millions) (b) Compute net operating assets (NOA) for 2010 and 2009. (Hint: Treat the Equity and Other Investments and the Long-Term Liabilities as operating.) 2010 NOA = 6,964 x ($ millions) 2009 NOA = 5,156 * ($ millions) (c) Compute Best Buy's RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2010. (Do not round until final answer. Round two decimal places. Do not use NOPM x NOAT to calculate RNOA.) 2010 RNOA = 5 X % 2010 NOPM = 4 * % 2010 NOAT = 3 X (d) Compute net nonoperating obligations (NNO) for 2010 and 2009. 2010 NNO = 54 x ($ millions) 2009 NNO = 32 x ($ millions) (e) Compute return on equity (ROE) for 2010. (Round your answers to two decimal places. Do not round until your final answer.) 2010 ROE = 24.03 % (f) Infer the nonoperating return component of ROE for 2010. (Use answers from above to calculate. Round your answer to two decimal places.) 2010 nonoperating return = 5 * %

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