The following information was summarized from the consolidated balance sheets of Walgreens Boots Alliance, Inc. and Subsidiaries (the company created with the combination of Walgreens and Boots Alliance) as of August 31, 2015 and 2014 and the consolidated statements of earnings for the years ended August 31, 2015 and 2014. All amounts are from Walgreens Boots Alliance's 2015 Form 10-K.

Required

1. Identify and analyze the transaction related to the collection of accounts receivable and sales during 2015. Assume that all of the company's sales are on account.

2. Walgreens Boots Alliance sets forth net sales but not gross sales on its income statement. What type(s) of deduction(s) would be made from gross sales to arrive at the amount of net sales reported?

3. Reconstruct the Cost of Goods Sold section of Walgreens Boots Alliance's 2015 income statement.

4. Calculate the gross profit ratios for Walgreens Boots Alliance for 2015 and 2014 and comment on the change noted, if any. Is the company's performance improving? What factors might have caused the change in the gross profit ratio?

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(In millions) Accounts receivable, net Cost of sales 2015 2014 $6,849 $ 3,218 54,823 76,520 8,678 . Inventories 6,076 .76,392 Net sales 103,444