Sales	$ 8,272	$ 8,828	$ 8,561
Credit card revenues	301	252	105
Total revenues	8,573	9,080	8,666
Cost of sales and related buying and occupancy costs	(5,417)	(5,526)	(5,354)
Selling, general and administrative expenses
Retail	(2,103)	(2,130)	(2,071)
Credit	(274)	(177)	(92)
Earnings before interest and income taxes	779	1,247	1,149
Net interest expense	(131)	(74)	(43)
Earnings before income taxes	648	1,173	1,106
Income tax expense	(247)	(458)	(428)
Net earnings	$ 401	$ 715	$ 678

Assets
Current Assets
Cash and cash equivalents	$ 72	$ 358
Accounts receivable, net	1,942	1,788
Merchandise inventories	900	956
Current deferred tax assets, net	210	181
Prepaid expenses and other	93	78
Total current assets	3,217	3,361
Land, buildings and equipment, net	2,221	1,983
Goodwill	53	53
Other assets	170	203
Total assets	$ 5,661	$ 5,600
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable	$ 563	$ 556
Accrued salaries, wages and related benefits	214	268
Other current liabilities	525	550
Current portion of long-term debt	299	261
Total current liabilities	1,601	1,635
Long-term debt, net	2,214	2,236
Deferred property incentives, net	435	369
Other liabilities	201	245
Shareholders' equity
Common stock, no par value	997	936
Retained earnings	223	201
Accumulated other comprehensive income (loss)	(10)	(22)
Total shareholders' equity	1,210	1,115
Total liabilities and shareholders' equity	$ 5,661	$ 5,600

(a) Compute net operating profit after tax (NOPAT) for 2009. Assume that the combined federal and statutory rate is: 37.0%. (Round your answer to the nearest whole number.) 2009 NOPAT = $Answer

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(b) Compute net operating assets (NOA) for 2009 and 2008. 2009 NOA = $Answer

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2008 NOA = $

Answer

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(c) Compute RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2009. Do not use NOPM x NOAT to calculate RNOA. (Do not round until your final answers. Round to two decimal places.) 2009 RNOA = Answer

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%

2009 NOPM =

Answer

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2009 NOAT =

Answer

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(d) Compute net nonoperating obligations (NNO) for 2009 and 2008. 2009 NNO = $Answer

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2008 NNO = $

Answer

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(e) Compute return on equity (ROE) for 2009. (Round your answers to two decimal places. Do not round until your final answer.) 2009 ROE = Answer

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%

(f) Infer the nonoperating return component of ROE for 2009. (Use answers from above to calculate. Round your answer to two decimal places.) 2009 nonoperating return = Answer

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(g) Comment on the difference between ROE and RNOA. Which of the following statements best describes the inference from the difference between Nordstrom's ROE and RNOA?

ROE>RNOA implies that Nordstrom's equity has grown faster than its NOA. The faster increase of equity compared to NOA allows higher dividends to be paid to Nordstrom's stockholders.ROE>RNOA implies that Nordstrom is able to borrow money to fund operating assets that yield a return greater than its cost of debt. The excess accrues to the benefit of Nordstrom's stockholders.

ROE>RNOA implies that Nordstrom has taken on too much financial leverage. The high financial leverage results in a higher interest rate on Nordstrom's debt, therefore the cost of debt is greater.ROE>RNOA implies that Nordstrom has increased its financial leverage during the period. The increase in financial leverage also increases Nordstrom's risk, therefore increasing the expected ROE by Nordstrom's stockholders