Analysis and Interpretation of Profitability Balance sheets and income statements for Best Buy Co., Inc....
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Accounting
Analysis and Interpretation of Profitability Balance sheets and income statements for Best Buy Co., Inc. follow.
Consolidated Statements of Earnings
For Fiscal Years Ended ($ millions)
February 26, 2011
February 27, 2010
February 28, 2009
Revenue
$ 50,272
$ 49,694
$ 45,015
Cost of goods sold
37,611
37,534
34,017
Restructuring charges - cost of goods sold
24
--
--
Gross Profit
12,637
12,160
10,998
Selling, general and administrative expenses
10,325
9,873
8,984
Restructuring charges
198
52
78
Goodwill and tradename impairment
--
--
66
Operating income
2,114
2,235
1,870
Other income (expense)
Investment income and other
51
54
35
Investment impairment
--
--
(111)
Interest expense
(87)
(94)
(94)
Earnings before income tax expense and equity in income of affiliates
2,078
2,195
1,700
Income tax expense
174
802
674
Equity in income of affiliates
2
1
7
Net earnings including noncontrolling interest
1,366
1,394
1,033
Net income attributable to noncontrolling interest
(89)
(77)
(30)
Net income attributable to Best Buy Co., Inc.
$ 1,277
$ 1,317
$ 1,003
Consolidated Balance Sheets
($ millions, except footnotes)
February 26, 2011
February 27, 2010
Assets
Current assets
Cash and cash equivalents
$ 1,103
$ 1,826
Short-term investments
22
90
Receivables
2,348
2,020
Merchandise inventories
5,897
5,486
Other current assets
1,103
1,144
Total current assets
10,473
10,566
Property and equipment
Land and buildings
766
757
Leasehold improvements
2,318
2,154
Fixtures and equipment
4,701
4,447
Property under capital lease
120
95
7,905
7,453
Less: Accumulated depreciation
4,082
3,383
Property and equipment, net
3,823
4,070
Goodwill
2,454
2,452
Tradenames, net
133
159
Customer relationships, net
203
279
Equity and other investments
328
324
Other noncurrent assets
435
452
Total assets
$ 17,849
$ 18,302
Liabilities and equity
Current liabilities
Accounts payable
$ 4,894
$ 5,276
Unredeemed gift card liabilities
474
463
Accrued compensation and related expenses
570
544
Accrued liabilities
1,471
1,681
Accrued income taxes
256
316
Short-term debt
557
663
Current portion of long-term debt
441
35
Total current liabilities
8,663
8,978
Long-term liabilities
1,183
1,256
Long-term debt
711
1,104
Equity
Best Buy Co., Inc. Shareholders' equity
Preferred stock, $1.00 par value
--
--
Common stock, $0.10 par value
39
42
Additional paid-in capital
18
441
Retained earnings
6,372
5,797
Accumulated other comprehensive income (loss)
173
40
Total Best Buy Co., Inc. shareholders' equity
6,602
6,320
Noncontrolling interest
690
644
Total equity
7,292
6,964
Total liabilities and equity
$ 17,849
$ 18,302
a. Compute ROE for 2011.
Do not round until your final answer. Round answer to two decimal places.
ROE =Answer
%
b. Confirm that ROE equals ROE computed using the component measures for profit margin, asset turnover, and financial leverage using: ROE = PM * AT * FL.
Compute the components of ROE.
Do not round until your final answer. Round answer to two decimal places.
PM = Answer
% AT = Answer FL = Answer c. Compute adjusted ROA. Assume a tax rate of: 37.0%.
Round answer to two decimal places. Adjusted ROA =Answer
%
answer al parts that say answer please.
Answer & Explanation
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