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2. Analyze, Forecast, and Interpret Income Statement and Balance Sheet Following are the income statements and balance sheets of AutoZone Inc.
AUTOZONE INC.
Consolidated Statements of Income
$ thousands						12 Months Ended Aug. 27, 2016
Net Sales						$ 10,635,676
Cost of sales, including warehouse and delivery expenses						$ 5,026,940
Gross profit						$ 5,608,736
Operating, selling, general, and administrative expenses						$ 3,548,341
Operating profit						$ 2,060,395
Interest expense, net						$ 147,681
Income before income taxes						$ 1,912,714
Income tax expense						$ 671,707
Net income						$ 1,241,007	AUTOZONE INC. Consolidated Statements of Income $ thousands, except for par value Aug. 27, 2016 Current assets Cash and cash equivalent $ 189,734 Accounts receivable $ 287,680 Merchandise inventories $ 3,631,916 Other current assets $ 130,243 Total current assets $ 4,239,573 Property and equipment, net $ 3,733,254 Goodwill $ 391,887 Deferred income taxes $ 36,855 Other long-term assets $ 198,218 Total assets $ 8,599,787 Current liabilities Accounts payable $ 4,095,854 Accrued expenses and other $ 551,625 Income taxes payable $ 42,841 Total current liabilities $ 4,690,320 Long-term debt $ 4,924,119 Deferred income taxes $ 284,500 Other long-term liabilities $ 488,386 Stockholders' deficit Preferred stock, authorized 1,000 shares; no shares issued Common stock, par value $0.01 per share, authorized 200,000 shares; 30,329 share issued and 29,118 shares outstanding in 2016 and 32,098 shares issued and 30,659 shares outstanding in 2015 $ 303 Additional paid-in capital $ 1,054,647 Retained deficit ($1,602,186) Accumulated other comprehensive loss ($ 307,529) Treasury stock, at cost ($ 932,773) Total stockholders' deficit ($1,787,538) Liabilities and stockholders' deficit $ 8,599,787 Forecast AutoZones 2017 income statement and balance sheet using the following relations ($ in thousands). All percentages (other than sales growth and provision for income taxes) are based on percent of net sales. Net Sales growth 6% Cost of sales, including warehouse and delivery expenses 47.30% Operating, selling, general and administrative expenses 33.40% Interest expense, net $145,000 Income tax expense (% pretax income) 35% Accounts receivable 2.70% Merchandise inventories 34.10% Other current assets 1.20% Accounts payable 38.50% Accrued expenses and other 5.20% Income taxes payable 0.40% CAPEX for 2017 will be 4.6% of 2017 Net sales and depreciation will be 8.3% of Property and equipment, net at the start of the fiscal year, which was $3,733,254 thousand. Goodwill, Deferred income taxes, Other long-term liabilities, AOCI, and Treasury stock will not change during the year. Other long-term assets including intangible assets. The 10-K reports that the 2017 amortization expense for intangibles will be $8,482 thousand. Long-term debt will decrease by $1,597,500 in 2017, per the 10-K.

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