S6-1 (Static) Finding Financial Information (LO 6-2, LO 6-6) Refer to the financial statements of The Home Depot in Appendix A. (Note: Fiscal 2019 for The Home Depot runs from February 4. 2019, to February 2, 2020.) Required: 1. What amount of Net Sales in millions) does the company report during the year ended February 2, 2020? O $110,225 $72,653 $37,572 O $11.242 2. Assuming that Cost of Sales is the company's term for Cost of Goods Sold, compute the company's gross profit percentage for fiscal 2019 and the year immediately prior to that O 65.9% and 65.7% 34.1% and 34.3% O 671% and 70.4% O 32.9% and 29.6% 3. Assume that The Home Depot experienced no shrinkage in the most current year. Using the balance sheet and income statement estimate the amount of purchases (in millions) in the year ended February 2, 2020. $72,653 $110,831 $72,047 O $73,259 THE HOME DEPOT, INC. Consolidated Balance Sheets February 2, 2020 "Fiscal 2019 February 3, 2019 "Fiscal 2018" $ 1.778 1,936 13.925 890 $ 2,133 2,106 14,531 1,040 19,810 22,770 5,595 2,254 807 $ 51,236 18.529 22,375 2.252 847 $ 44,003 in millions, except per share data ASSETS Current assets: Cash and cash equivalents Receivables, net Merchandise inventories Other current assets Total current assets Net property and equipment Operating lease right-of-use assets Goodwill Other assets 1 Total assets LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Short-term debt Accounts payable Accrued salaries and related expenses Sales taxes payable Deferred revenue Income taxes payable Current installments of long-term debt Current operating lease liabilities Other accrued expenses Total current liabilities Long-term debt, excluding current installments Long-term operating least liabilities Deferred income taxes Other long-term liabilities Total liabilities Common stock, par value $0.05; authorized: 10.000 shares; issued 1.786 shares at February 2, 2020 and 1,782 shares at February 3, 2019; outstanding: 1.077 shares at February 2, 2020 and 1,105 shares at February 3, 2019 Paid-in capital Retained earnings $ 1,339 7.755 1.506 656 1,782 11 1.056 $ 974 7,787 1,494 605 2,116 55 1,839 828 2.677 18,375 28,670 5,066 706 1,535 54,352 2.611 16,716 26,807 491 1,867 45,881 89 11,001 51,729 89 10,578 46,423 (739) (772) Accumulated other comprehensive loss Treasury stock, at cost. 709 shares at February 2, 2020 and 677 shores at February 3, 2019 Total stockholders' (deficit) oquity Total liabilities and stockholders' equity (65,196) (3.116) $ 51.2.36 (58.196 (1.878) 544,003 See accompanying notes to consolidated financial statements Source: The Home Depot Form 10 K 1 Copyright McGraw Hill LLC. All rights retarved. No reproduction or distribution without the prior written consent of McGraw Hill LLC Fiscal 2018 $108,203 71,043 37.160 Fiscal 2017 $100,904 66,548 14.356 AS APPENDIX A Excerpts from the Fiscal 2019 T0 K Annual Report of The Home Depot, Inc THE HOME DEPOT, INC. Consolidated Statements Of Eatings in millions, except per share data Fiscal 2019 NET SALES $110,225 Cost of sales 72,653 GROSS PROFIT 37,572 Operating expenses : Selling, general and administrative 19,740 Depreciation and amortization 1.989 Impairment loss Total operating expenses 21,729 OPERATING INCOME 15,843 Interest and other income) expenses Interest and investment income (73) Interest expense 1,201 Other 19.51 1.820 17.864 1811 242 21.630 15.530 19.675 14,681 (93) 1,051 16 (74) 1,057 Interest and other, net EARNINGS BEFORE PROVISION FOR INCOME TAXES Provision for income taxes NET EARNINGS Basic weighted average common shares BASIC EARNINGS PER SHARE Diluted weighted average common shares DILUTED EARNINGS PER SHARE Fiscal 2019 and fiscal 2017 include 52 weeks. Piscal 2018 includes 53 weeks See accompanying notes to consolidated financial statements 1,128 14,715 3,473 $ 11.242 1,093 $ 10.29 1,097 $ 10.25 974 14,556 3.435 S 11,121 1.137 S 9.78 1.143 $ 9.73 983 13.698 5,068 $ 8,630 1.178 s 7.33 1,184 s 7.29 Fiscal 2018 $11,121 Fiscal 2017 58,630 311 THE HOME DEPOT, INC. Consolidated Statements or Comprehensive Income in millions Fiscal 2019 Net carnings $11,242 Other comprehensive income (loss): Foreign currency translation adjustments 53 Cash flow hedges, net of tax 8 Other 3 Total other comprehensive incomo (loss) 64 COMPREHENSIVE INCOME $11,306 Facial 2019 and fiscal 2017 include 52 weeks. Focal 2018 includes $3 wekt. Ser accompanying notes to consolidated financial statements (267) 53 8 (206) $10,915 (9) 301 $8,931 A9 Fiscal 2017 $ 88 89 9,787 132 172 273 10.192 I 35.519 APPENDIX A Excerpts from the Pascal 2019 10-K Annual Report of The Hartiet Depot, Inc THE HOME DEPOT, INC Consolidated Statements Of Stockholders' Equity in millions Fiscal 2019 Fiscal 2018 Common Stock: Balance at beginning of year $ 89 Shares issued under employee stock plans Balance at end of year Paid-in Capital: Balance at beginning of year 10,578 10,192 Shares issued under employee stock plans 104 Stock-based compensation expense 251 282 Balance at end of year 11,001 10.578 I Retained Earnings Balance at beginning of year 46,423 39,935 Cumulative effect of accounting changes 26 75 Net earnings 11.242 11.121 Cash dividends (5,958) (4.704) Other (4) Balance at end of year 51,729 46,423 Accumulated Other Comprehensive Income (Loss): Balance at beginning of year (772) (566) Cumulative effect of accounting changes Foreign currency translation adjustments (267) Cash flow hedges, net of tax 8 53 Other 3 8 Balance at end of year (739) (772) Treasury Stock: Balance at beginning of year (58,196) (48,196) Repurchases of common stock (7,000) (10,000) Balance at end of year (65,196) (58,196) Total stockholders' (deficit) cquity (3,116 S(1878) 8630 (4.212) (2) 39.935 (867) (31) 53 311 (1) (9) (566 (40,194 (8,002) (48,196) $1.454 Fiscal 2019 Fiscal 2018 Fiscal 2017 $ 11,242 $ 11,121 58,630 2,296 251 2,062 273 (170) (593) (135) 68 334 44 202 184 2,152 282 247 33 (1,244) (257) 743 80 (42) 26 (103) 13,038 139 (84) (10) 352 128 29 92 420 12,031 13,723 (2,678) in millions CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings Reconciliation of net earnings to net cash provided by operating activities: Depreciation and amortization Stock-based compensation expense Impairment loss Changes in receivables.net Changes in merchandise inventories Changes in other current assets Changes in accounts payable and accrued expenses Changes in deferred revenue Changes in income taxes payable Changes in deferred income taxes Other operating activities I Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures Payments for businesses acquired, net Proceeds from sales of property and equipment Other investing activities Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES: (Repayments ) proceeds from short-term debt, net Proceeds from long-term debt, net of discounts and premium Repayments of long-term debt Repurchases of common stock Proceeds from sales of common stock Cash dividends Other financing activities Net cash used in financing activities Change in cash and cash equivalents Effect of exchange rate changes on cash and cash equivalents Cash and cash equivalents at beginning of your Cash and cash equivalents at end of year SUPPLEMENTAL DISCLOSURES: Cash paid for income taxes Cash paid for interest, net of interest capitalized (2,442) (21) 33 (1,897) (374) 47 37 (12) (2,653) (2.416) (2.228) (365) 3,420 (1,070) (6,965) 280 (5,958) (176) (10,834) 2.36 119 1,778 $ 2,133 850 2.991 (543) (8,000) 255 (4.212) (220) 3,466 (1.209) (9.963) 236 (4.705) (26 (12.420) (1.798) (19) 3.595 $ 1.278 (8,870) 933 124 2.518 $3,595 $ 3,220 1,112 $ 3.774 1,035 $4,732 991