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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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

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

Current Installments of Long-Term Debt

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

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.