This comprehensive problem is to acquaint you with the content of the 2015 financial statements of home Depot, inc., and related disclosures, excerpts on which are reproduced in Appendix A of this textbook. ( The 2015 financial statements are for fiscal year ended January 31, 2016.) The problem contains three major parts, which are independent of one another: Part 1 is designed to familiarize you with the general contents of a company's financial statements; Part 2 involves analysis of the company's liquidity; and part 3 analyzes the trend in its profitability.

The first note accompanying the financial statements provides a brief description of the major accounting policies the company used. Most of the areas discussed in this note have been covered in this text.

Part III

As general background study the "Five-Year Summary of Financial and Operating Results. "

Instructions:

a. Compute the following for the fiscal year ending January 31, 2016, and February 1, 2015 ( round percentages to the nearest tenth of 1 percent):

1. Percentage change in net sales. ( relative to the prior year).

2. Percentage change in net earnings.

3. Gross profit rate.

4. Net income as a percentage of sales.

5. Return on average total assets.

6. Return on average total equity

b. describe your conclusion(S) concerning trends in Home Depot's profitability during the period covered in your analysis in part a. above. Justify your conclusion(S).