Question 1: Presenting an Income Statement and Computing Key Ratios

Best Buy Co., Inc., reported the following amounts in its February 1, 2014, and February 2, 2013, financial statements.

($ millions)

2014

2013

Sales revenue

$42,410

$39,827

Cost of sales

32,720

30,528

Net income (loss)

523

(420)

Total assets

14,013

16,787

Stockholders' equity

3,989

3,715

Required a. Prepare an income statement for Best Buy for the year ended February 1, 2014, using the format illustrated in Exhibit 1.8.

BEST BUY CO., INC.

Income Statement ($ millions)

Answer

b. Calculate Best Buy's return on equity for the year ended February 1, 2014. (Round your answer to one decimal place. Ex: 0.0345 = 3.5%.)

c. Compute Best Buy's debt-to-equity ratio as of February 1, 2014.

(Round your answer to one decimal place.)