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Posted on Jul 27, 2024

The goal is to use real wold finanical statements to answer the following questions. 1. what is the percentage of assets being financed with liabilities?

The goal is to use real wold finanical statements to answer the following questions.

1. what is the percentage of assets being financed with liabilities? versus shareholders equity?

2. what is the average interest rate that Target paid on its borrowing?

3. Since Target reported accrued and other liabilties. Then what was the largest subcategory of liabilities?

4. How many shares of common stock were outstanding as of March 7, 2019?

Effect of Accounting Standards Adoption on Consolidated Statement of Financial Position 8| IIIIIII (74) Effect of the Adoption of February 3. ASC 2018 Topic 805 ASC February 3 As Previously (Revenue Topic 842 2018 (millions) (unaudited) Reported Recognition) Leases) As Adjusted Assets Cash and cash equivalents 2,643 $ $ 2.643 Inventory 8,657 (60) 8,597 Other current assets 1,264 (24) 1,300 Total current assets 12,564 (24) 12,540 Property and equipment Land 6,095 6,095 Buildings and improvements 28,396 (265) 28.131 Fixtures and equipment 5,623 5,623 Computer hardware and software 2,645 2,645 Construction-in-progress 440 440 Accumulated depreciation (18,181) (217) (18,398) Property and equipment, net 25.018 (482) 24,536 Operating lease assets 1,884 1,884 Other noncurrent assets 1.417 1,343 Total assets $ 38,999 $ 1,304 $ 40,303 Liabilities and shareholders' investment Accounts payable 8,677 $ 8,677 Accrued and other current liabilities 4.254 (14) (146) 4,094 Current portion of long-term debt and other borrowings 270 11 281 Total current liabilities 13,201 (14) (135) 13,052 Long-term debt and other borrowings 11,317 (200) 11,117 Noncurrent operating lease liabilities 1,924 Deferred income taxes 713 (24) 693 Other noncurrent liabilities 2,059 1,866 Total noncurrent liabilities 14,089 1,508 15,600 Shareholders' investment Common stock 45 45 Additional paid-in capital 5,858 5,858 Retained earnings 6,553 10 (69) 6,495 Accumulated other comprehensive loss (747) (747) Total shareholders investment 11,709 10 (69) 11,651 Total liabilities and shareholders' investment $ 38,999 $ 1,304 $ 40,303 Note: The sum of "As Previously Reported" amounts and effects of the adoption of the new standards may not equal "As Adjusted amounts due to rounding. Represents estimated merchandise returns, which were reclassified from Inventory to Other Current Assets Represents prepaid rent reclassified to Operating Lease Assets. Represents impact of changes in finance lease terms and related leasehold improvements (net of accumulated depreciation) under the hindsight practical expedient and derecognition of approximately $135 million of non- Target owned properties that were consolidated under previously existing build-to-suit accounting rules. Represents capitalization of operating lease assets and reclassification of leasehold acquisition costs, straight- line rent accrual, and tenant incentives. 1.924 N (192) IN Consolidated Statements of Shareholders' Investment (9) 11 IIIIIII Common Stock Additional Retained Accumulated Other Stock Par Paid-in Comprehensive (millions) Shares Value Earnings Capital As Adjusted (Loss)/Income Total January 30, 2016 6022 $ 50 $ 5,348 $ 8,196 $ (629) $ 12,965 Adoption of ASC Topic 842 (Leases) (43) (43) Net earnings 2.734 2.734 Other comprehensive loss (9) Dividends declared (1.359) (1,359) Repurchase of stock (50.9) (3,682) (3,686) Stock options and awards 4.9 313 313 January 28, 2017 556.2 $ 46 $ 5,661 $ 5,846 $ (638) $ 10,915 Net earnings 2,914 2,914 Other comprehensive income 8 8 Dividends declared (1,356) (1,356) Repurchase of stock (17.6) (1,026) (1,027) Stock options and awards 3.1 197 Reclassification of tax effects to retained earnings 117 (117) February 3, 2018 541.7 $ 45 $ 5,858 $ 6,495 $ (747) $ 11,651 Net earnings 2,937 2,937 Other comprehensive loss (58) Dividends declared (1,347) (1,347) Repurchase of stock (272) (2) (2,068) (2,070) Stock options and awards 3.3 184 184 February 2, 2019 517.8 $ 43 $ 6,042 $ 6,017 S (805) $ 11,297 We declared $2.54, $2.46, and $2.36 dividends per share for the twelve months ended February 2, 2019, February 3, 2018, and January 28, 2017, respectively. See accompanying Notes to Consolidated Financial Statements. Refer to Note 2 regarding the adoption of new accounting standards for revenue recognition, leases, and pensions 197 III 1191 (58) 132 Consolidated Statements of Cash Flows 2017 2016 (millions) 2018 As Adjusted As Adjusted Operating activities Net earnings 2.9375 2.914 $ 2,734 Earnings from discontinued operations, net of tax 7 6 68 Net earnings from continuing operations 2.930 2.908 2,666 Adjustments to reconcile net earnings to cash provided by operations: Depreciation and amortization 2,474 2.476 2.318 Share-based compensation expense 112 113 Deferred income taxes 322 (188) 40 Loss on debt extinguishment 123 422 Noncash losses/gains) and other, net 95 208 (11) Changes in operating accounts Inventory (900) (348) 293 Other assets (299) (156) 56 Accounts payable 1,127 1,307 (166) Accrued and other liabilities 89 419 (394) Cash provided by operating activities-continuing operations 5.970 6.861 5,337 Cash provided by operating activities-discontinued operations 3 74 107 Cash provided by operations 5.973 6,935 5,444 Investing activities Expenditures for property and equipment (3.516) (2.533) (1.547) Proceeds from disposal of property and equipment 85 31 46 Cash paid for acquisitions, net of cash assumed (518) Other investments 15 (55) 28 Cash required for investing activities (3.416) (3.075) (1.473) Financing activities Additions to long-term debt 739 1,977 Reductions of long-term debt (281) (2.192) (2.649) Dividends paid (1.335) (1.338) (1,348) Repurchase of stock (2.124) (1.046) (3.706) Stock option exercises 96 108 221 Cash required for financing activities (3.644) (3.729) (5,505) Net (decrease)/increase in cash and cash equivalents (1,087) 131 (9.534) Cash and cash equivalents at beginning of period 2,643 2,512 4,046 Cash and cash equivalents at end of period 1,556 5 2,643 $ 2.512 Supplemental information Interest paid, net of capitalized interest 476 $ 678 S 999 Income taxes paid 373 934 1,514 Leased assets obtained in exchange for new finance lease liabilities 130 139 252 Leased assets obtained in exchange for new operating lease liabilities 246 212 148 See accompanying Notes to Consolidated Financial Statements. fa Refer to Note 2 regarding the adoption of new accounting standards for revenue recognition, leases, and pensions. $ Consolidated Statements of Financial Position February 3, February 2, 2018 (millions, except footnotes) 2019 As Adjusted Assets Cash and cash equivalents 1,556 $ 2,643 Inventory 9,497 8.597 Other current assets 1.466 1,300 Total current assets 12,519 12,540 Property and equipment Land 6,064 6,095 Buildings and improvements 29,240 28.131 Fixtures and equipment 5,912 5,623 Computer hardware and software 2,544 2,645 Construction-in-progress 460 440 Accumulated depreciation (18,687) (18,398) Property and equipment, net 25,533 24,536 Operating lease assets 1.965 1,884 Other noncurrent assets 1.273 1,343 Total assets 41.290 $ 40.303 Liabilities and shareholders' investment Accounts payable $ 9,761 $ 8.677 Accrued and other current liabilities 4,201 4,094 Current portion of long-term debt and other borrowings 1,052 281 Total current liabilities 15,014 13,052 Long-term debt and other borrowings 10,223 11,117 Noncurrent operating lease liabilities 2,004 1,924 Deferred income taxes 972 693 Other noncurrent liabilities 1.780 1.866 Total noncurrent liabilities 14.979 15,600 Shareholders' investment Common stock 45 Additional paid-in capital 6,042 5,858 Retained earnings 6,017 6,495 Accumulated other comprehensive loss (805) (747) Total shareholders' investment 11,297 11,651 Total liabilities and shareholders' investment 41,290 S 40,303 Common Stock Authorized 6,000,000,000 shares, $0.0833 par value; 517,761,600 shares issued and outstanding at February 2, 2019, 541,681,670 shares issued and outstanding at February 3, 2018 Preferred Stock Authorized 5,000,000 shares, 50.01 par value; no shares were issued or outstanding at February 2. 2019 or February 3, 2018 See accompanying Notes to Consolidated Financial Statements. Refer to Note 2 regarding the adoption of new accounting standards for revenue recognition, leases, and pensions 43 Consolidated Statements of Comprehensive Income 4 2017 2016 (millions) 2018 As Adjusted As Adjusted Net earnings $ 2,937 $ 2,914 $ 2.734 Other comprehensive (loss) /income, nel of lax Pension and other benefit liabilities, net of tax (52) 2 (13) Currency translation adjustment and cash flow hedges, net of tax (6) 6 Other comprehensive (loss)/income (58) 8 (9) Comprehensive income $ 2,879 $ 2,922 $ 2,725 See accompanying Notes to Consolidated Financial Statements. Refer to Note 2 regarding the adoption of new accounting standards for revenue recognition, leases, and pensions Consolidated Statements of Operations 928 6 $ 2017 2016 (millions, except per share data) 2018 As Adjusted As Adjusted Sales 74,433 $ 71,786 $ 69,414 Other revenue 923 857 Total revenue 75,356 72,714 70,271 Cost of sales 53,299 51,125 49,145 Selling, general and administrative expenses 15.723 15,140 14,217 Depreciation and amortization (exclusive of depreciation included in cost of sales) 2,224 2.225 2,045 Operating income 4,110 4,224 4,864 Net interest expense 461 653 991 Net other (income) / expense (27) (59) (88) Earnings from continuing operations before income taxes 3,676 3,630 3,961 Provision for income taxes 746 722 1.295 Net earnings from continuing operations 2,930 2,908 2,666 Discontinued operations, net of tax 7 68 Net earnings 2,937 $ 2,914 $ 2.734 Basic earnings per share Continuing operations 5.54 $ 5.32 $ 4.61 Discontinued operations 0.01 0.01 0.12 Net earnings per share $ 5.55 $ 5.32 $ 4.73 Diluted earnings per share Continuing operations $ 5.50 $ 5.29 $ 4.58 Discontinued operations 0.01 0.01 0.12 Net earnings per share 5.51 $ 5.29 $ 4.69 Weighted average common shares outstanding Basic 528.6 546.8 577.6 Diluted 533.2 550.3 582.5 Antidilutive shares 4.1 0.1 Note: Per share amounts may not foot due to rounding. See accompanying Notes to Consolidated Financial Statements. Refer to Note 2 regarding the adoption of new accounting standards for revenue recognition, leases, and pensions. s $ $ a)