Question
The following are the consolidated statement of earnings and the balance sheet of Home Depot, Inc and Subsidiaries. THE HOME DEPOT, INC. AND SUBSIDIARIES CONSOLIDATED
The following are the consolidated statement of earnings and the balance sheet of Home Depot, Inc and Subsidiaries.
THE HOME DEPOT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS | |||||||||||
Fiscal Year Ended(1) | |||||||||||
amounts in millions, except per share data | January 31, 2016 | February 1, 2015 | February 2, 2014 | ||||||||
NET SALES | $ | 88,519 | $ | 83,176 | $ | 78,812 | |||||
Cost of Sales | 58,254 | 54,787 | 51,897 | ||||||||
GROSS PROFIT | 30,265 | 28,389 | 26,915 | ||||||||
Operating Expenses: | |||||||||||
Selling, General and Administrative | 16,801 | 16,280 | 16,122 | ||||||||
Depreciation and Amortization | 1,690 | 1,640 | 1,627 | ||||||||
Total Operating Expenses | 18,491 | 17,920 | 17,749 | ||||||||
OPERATING INCOME | 11,774 | 10,469 | 9,166 | ||||||||
Interest and Other (Income) Expense: | |||||||||||
Interest and Investment Income | (166 | ) | (337 | ) | (12 | ) | |||||
Interest Expense | 919 | 830 | 711 | ||||||||
Interest and Other, net | 753 | 493 | 699 | ||||||||
EARNINGS BEFORE PROVISION FOR INCOME TAXES | 11,021 | 9,976 | 8,467 | ||||||||
Provision for Income Taxes | 4,012 | 3,631 | 3,082 | ||||||||
NET EARNINGS | $ | 7,009 | $ | 6,345 | $ | 5,385 | |||||
Weighted Average Common Shares | 1,277 | 1,338 | 1,425 | ||||||||
BASIC EARNINGS PER SHARE | $ | 5.49 | $ | 4.74 | $ | 3.78 | |||||
Diluted Weighted Average Common Shares | 1,283 | 1,346 | 1,434 | ||||||||
DILUTED EARNINGS PER SHARE | $ | 5.46 | $ | 4.71 | $ | 3.76 | |||||
(1) Fiscal years ended January 31, 2016, February 1, 2015 and February 2, 2014 include 52 weeks.
THE HOME DEPOT, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS | |||||||
amounts in millions, except share and per share data | January 31, 2016 | February 1, 2015 | |||||
ASSETS | |||||||
Current Assets: | |||||||
Cash and Cash Equivalents | $ | 2,216 | $ | 1,723 | |||
Receivables, net | 1,890 | 1,484 | |||||
Merchandise Inventories | 11,809 | 11,079 | |||||
Other Current Assets | 1,078 | 1,016 | |||||
Total Current Assets | 16,993 | 15,302 | |||||
Property and Equipment, at cost | 39,266 | 38,513 | |||||
Less Accumulated Depreciation and Amortization | 17,075 | 15,793 | |||||
Net Property and Equipment | 22,191 | 22,720 | |||||
Goodwill | 2,102 | 1,353 | |||||
Other Assets | 1,263 | 571 | |||||
Total Assets | $ | 42,549 | $ | 39,946 | |||
LIABILITIES AND STOCKHOLDERS EQUITY | |||||||
Current Liabilities: | |||||||
Short-Term Debt | $ | 350 | $ | 290 | |||
Accounts Payable | 6,565 | 5,807 | |||||
Accrued Salaries and Related Expenses | 1,515 | 1,391 | |||||
Sales Taxes Payable | 476 | 434 | |||||
Deferred Revenue | 1,566 | 1,468 | |||||
Income Taxes Payable | 34 | 35 | |||||
Current Installments of Long-Term Debt | 77 | 38 | |||||
Other Accrued Expenses | 1,943 | 1,806 | |||||
Total Current Liabilities | 12,526 | 11,269 | |||||
Long-Term Debt, excluding current installments | 20,888 | 16,869 | |||||
Other Long-Term Liabilities | 1,965 | 1,844 | |||||
Deferred Income Taxes | 854 | 642 | |||||
Total Liabilities | 36,233 | 30,624 | |||||
STOCKHOLDERS EQUITY | |||||||
Common Stock, par value $0.05; authorized: 10 billion shares; issued: 1.772 billion shares at January 31, 2016 and 1.768 billion shares at February 1, 2015; outstanding: 1.252 billion shares at January 31, 2016 and 1.307 billion shares at February 1, 2015 | 88 | 88 | |||||
Paid-In Capital | 9,347 | 8,885 | |||||
Retained Earnings | 30,973 | 26,995 | |||||
Accumulated Other Comprehensive Loss | (898 | ) | (452 | ) | |||
Treasury Stock, at cost, 520 million shares at January 31, 2016 and 461 million shares at February 1, 2015 | (33,194 | ) | (26,194 | ) | |||
Total Stockholders Equity | 6,316 | 9,322 | |||||
Total Liabilities and Stockholders Equity | $ | 42,549 | $ | 39,946 | |||
Selected information as on February 2, 2014:
Working capital | $ | 4,530 | ||
Cash balance | $ | 1,929 | ||
Total assets | $ | 40,518 | ||
Stockholders' equity | $ | 12,522 | ||
Assume that you are the credit manager of a medium-size supplier of building materials and related products. Home Depot wants to make credit purchases from your company, with payment due in 60 days.
Instructions:
a-1. Compute the current ratio for the fiscal years ending January 31, 2016, and February 1, 2015.
a-2. Compute the quick ratio for the fiscal years ending January 31, 2016, and February 1, 2015.
a-3. Compute the amount of working capital for the fiscal years ending January 31, 2016, and February 1, 2015.
a-4. Compute the percentage change in working capital from the prior year for the fiscal years ending January 31, 2016, and February 1, 2015.
a-5. Compute the percentage change in cash and cash equivalents from the prior year for the fiscal years ending January 31, 2016, and February 1, 2015.
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