Please see attachment for instructions.

Excel files have several tabs underneath. (Requirements 1-6)

Due: April 27, 2016 at 3:00PM

ACG2021 Fall 2015 Comprehensive Financial Statement Analysis Project Group Members Last Name First Name 100% 100% 100% The objective of this exercise is to develop your ability to perform analysis of the financial information included in financial statements. Instructions: You will need the annual report for Kohl's Corporation for fiscal years 2014 and 2013. They will be provided to you in pdf format. Note that Kohl's fiscal year is referenced one year back, so, for example, the 2014 fiscal year relates to the fiscal year which ended on January 31, 2015, but which includes 11 months of 2014 activity. Requirement 1: Basic Questions Answer the questions for the fiscal 2014 year in the shaded input box. The location (source) where you can find the answer is provided for you above the shaded input box. Use only that source to answer the question. Requirement 2 - 6: Ratio and Financial Analysis For the ratios in requirements 2 and 3, provide the formula of the ratio, the amounts used to calculate the ratio and what the ratio measures. Enter your answers in the shaded input boxes. The first one (a.) was completed as an illustration. The ratio formulas are listed in pages 775 - 777 in chapter 13 of your textbook. I have added the number of the ratio listed in pages 775 - 777 to each ratio so that you know exactly how to calculate them. When calculating the ratios, only use the amounts included in the audited financial statements (Item 8. Financial Statements and Supplementary Data); do not just enter those that may be shown in other sections of the annual report. All other sections of the annual report except for the financial statements are not audited and as such the preparer can calculate any other ratios or financial indicators are they wish, not necessarily as the textbook prescribes. If you pick up amounts in other sections you risk getting the question wrong. Since the fiscal 2014 financial statements are comparative, they include info for both fiscal years 2014 and 2013. Use those financial statements to answer the questions about fiscal 2013 as well. However, some ratios for the 2013 year will require you go to back an additional year because some of the 2013 ratios use averages which are calculated using the 2013 + 2012 balances. For example, the inventory turnover for 2013 uses average inventory calculated by using the 2013 ending inventory balance + the 2012 beginning inventory balance (which is the ending balance in 2012). You need to obtain the fiscal 2012 ending inventory balance included in the 2013 financial statements which have been provided to you. For ratios that include averages, use a simple average calculation (beginning + ending balance / 2). Other: Several questions have multiple parts. Make sure you answer every part in order to receive full credit. Please do not add columns or rowns to this file. I will be using this file to grade and my grading template is in this same format. The points assigned to each question are included in the boxes highlighted in pink on the right-hand side of the question. There are 120 points which is equivalent to 100%. Additional extra credit points, up to 10, can be earned by providing additional relevant information when evaluating the ratios or preparing your analysis. Requirement 1 Answer BASIC INFORMATION about company operations and financial results for the 2014 fiscal year (ended January 31, 2015). NOTE: Use amounts found in the "Source" only to answer these questions. Points a. As of January 31, 2015, how many stores did Kohl's operate and in how many states? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 1 b. When does the fiscal year end each year? How many weeks did fiscal 2014 have? How about fiscal 2013? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 1 c. Does Kohl's report a multi-step or single-step income statement? How do you know? Source: Item 8. Consolidated Statements of Income 2 d. What is Kohl's largest asset? Largest liability? What is the amount of both? Source: Item 8. Consolidated Balance Sheets 2 e. How many shares of common stock are Issued? Outstanding? Source: Item 8. Consolidated Balance Sheets 2 f. How many shares of treasury stock did Kohl's purchase during the year? Source: Item 8. Consolidated Statements of Changes in Shareholders' Equity 2 g. How much was dividends declared and paid per share? Source: Item 8. Consolidated Statements of Income 2 h. When does Kohl's record revenue? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 1 i. What method does Kohl's use to value its inventory? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 1 j. What method does Kohl's use to depreciate its property and equipment? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 1 k. What percentage of Kohl's total property and equipment are depreciated at year-end? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 2 l. What items are recorded as cash equivalents? Source: Item 8. Notes to Consolidated Financial Statements: Note #1 2 m. What types of Other Comprehensive Income items does Kohl's have? Source: Item 8. Consolidated Statements of Comprehensive Income 2 n. Was Kohl's debt issued at a discount or premium in the aggregate? Source: Item 8. Notes to Consolidated Financial Statements: Note #2 2 o. What type of items are included in the Various Liabilities to Customers? Why are they classified as liabilities? Source: Notes to Consolidated Financial Statements: Note #1 2 p. Using a site such as www.hoovers.com or www.finance.yahoo.com, research the discount variety store industry. List three competitors of Kohl's Corporation. Source: Type source here 2 q. List three Kohl's brands. Source: Item1. Business 2 r. Does Kohl's have any business relations with foreign entities such as suppliers or customers? Source: Item1. Business 2 s. Describe three risk factors that Kohl's faces. Source: Item 1A. Risk Factors. 2 t. What was the name of the multi-year framework that was introduced in the 1st quarter of 2014? Source: Item 7. Management's Discussion and Analysis: Results of Operations. 2 u. What new brands did Kohls introduce during the 2014 fiscal year (ended 1/31/15)? Source: Item 7. Management's Discussion and Analysis: Liquidity and Capital Resources 2 37 KOHLS 2014 Fiscal Year (Ended 1/31/15) Ratio (Refer to pgs 775 - 777 for ratio formula) Calculation of Ratio Show work KOHLS 2013 Fiscal Year (Ended 2/1/14) Calculation of Ratio Ratio Show work Points Ratio Requirement 2 Evaluate PROFITABILITY. Using information you have learned in the text and elsewhere, evaluate Kohl's profitability for year ended 1/31/15 compared with year ended 2/1/14. In your analysis, you should compute the following ratios and then comment on what those ratios indicate. NOTE: Use amounts in the audited financial statements only to calculate these ratios (Item 8. of annual report). a. Rate of return on sales #13 4.6% Ratio: Net income / Net sales $ $ 867 19,023 4.7% $ $ 889 19,031