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Please help with the xs Analysis and Interpretation of Profitability Balance sheets and income statements for Costco Wholesale Corporation follow. Costco Wholesale Corporation Consolidated Statements

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Analysis and Interpretation of Profitability Balance sheets and income statements for Costco Wholesale Corporation follow. Costco Wholesale Corporation Consolidated Statements of Earnings For Fiscal Years Ended ($ millions) September 2, 2018 Total revenue $141 576 Operating expenses Merchandise costs 123 152 Selling, general and administrative 13.876 Preopening expenses 68 Operating Income 4480 Other income (expense) Interest expense 159 Interest income and other net (121) Income before income taxes 4.442 Provision for income taxes 1,263 Net income including noncontrolling interests 3,179 Net income attributable to noncontrolling interests (45) Net income attributable to Costco $3,134 Costco Wholesale Corporation Consolidated Balance Sheets (5 millions, except par value and share data) September 2, 2018 September 3, 2017 Current assets Cash and cash equivalents $6,055 $4,546 Short-term investments 1,204 1,233 Receivables, net 1,669 1.432 Merchandise inventories 11,040 9,834 Other current assets 321 272 Total current assets 20,289 17,317 Net property and equipment 19,681 18,161 Other assets 860 869 Total assets 540,830 536,347 Current liabilities Accounts payable $11,237 $9,608 Accrued salaries and benefits 2.994 2,703 Accrued member rewards 1,057 961 Deferred membership fees 1,624 1,498 Other current liabilities 3,014 2,725 Total current liabilities 19,926 17,495 Long-term debt 6,487 6,573 Other liabilities 1,314 1,200 Total liabilities 27,727 25,268 Equity Preferred stock, 50.01 par value: 0 0 Common stock, 50.01 par value 4 4 Additional paid-in-capital 6,107 5,800 Accumulated other comprehensive loss (1,199) (1,014) Retained earnings 7,887 5,988 Total Costco stockholders equity 12,799 10,778 Noncontrolling interests 304 301 Total equity 13,103 11,079 Total liabilities and equity $40,830 536,347 (a) Compute net operating profit after tax (NOPAT) for 2018. Assume that the combined federal and state statutory tax rate is 22%. (Round your ans 2018 NOPAT = 3.494 * ($ millions) (b) Compute net operating assets (NOA) for 2018 and 2017 2018 NOA = 12,331 ($ millions) 2017 NOA = 11.873 (5 millions) (c) Compute Costco's RNOA net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2018. (Do not round until final answer. 2018 RNOA = 28,87 X% 2018 NOPM 2.47 X% 2018 NOAT 11.7 (d) Compute net nonoperating obligations (NNO) for 2018 and 2017. Confirm the relation: NOA = NNO + Total equity 2018 NNO (772) (5 millions) 2017 NNO 794 (5 millions) (e) Compute return on equity (ROE) for 2018. (Round your answers to two decimal places. Do not round until your final answer.) 2018 ROE = 4.18 X% in infer the nonoperating return component of ROE for 2018. Use answers from above to calculate. Round your answer to two decimal places.) (24.69) X (8) Comment on the difference between ROE and RNOA. What does this relation suggest about Costco's use of equity capital? ROERNOA implies that Costco's equity has grown faster than its NOA CROERNOA implies that Costco has taken on too much financial leverage. ROERNOA Implies that Costco is able to borrow money to fund operating assets that yield a return greater than its cost of debt ROERNOA implies that Costco increased its financial leverage during the period

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