The accompanying riotes are an integral part of these consolidated financial statements. 36 Table of Contents COSTCO WHOLESALE CORPORATION CONSOLIDATED STATEMENTS OF EQUITY (amount millions) Accumulated Additional Total Cost Stnckholders Equity Common tock Paid-in apis Comprehensive Income (Loss) Retained Earnin Noncontrolling Interests Total Shares (00w Amount 10843 RALANCE AT AUGUST 30, 2015 5.211 (1.121) 518 5 10517 28 2350 tincome 350 28 2376 d ather, net Foraign-currancy translation adustmant 26 Stock based compensation 10C 458 458 Reloare of vested restricted stock un ts RSU ), including tax efects 2,749 (14 140 40 onvertible netes (3.1841 Repurchases uf common slock (436) 477 41 477 (746 (746 Cash dividends declared and other (749) 3) AUE HALANCE AL AUGUS1 2U, 2016 12 A 41424 12.0/% 241 Nct income 2679 2714 trannlation ndustment and ather, net. .. Sloukbwsed caumesation 518 518 518 c effects 166) Release of veated RSUS inchudina t 7ETT M65 (165 Convarsion at convartible notes (2.998 Repurchases of commen a 41 (473) (4/3 +32 (3 046) the .. 5.800 5.988 11 079 RALANCE AT SEPTEMBER 3 2017 437 204 1 014) 301 3 134 3 134 Nat income 5 3,179 dother, net (1S2) Foraign-currancy translation adustmant (1861 Stock Eased compchson (217 Release of vested RSUs, including effects 2.741 217 217) Caeb daidseds declared and other 971 (351 (939) (936) (1.190) 438.189 6.107 7 887 12.799 04 13.103 HALANCE AT SEPTEMBER 2, 2018 The accompanying nates are an integral part ot these consolidated financial statements. 30 lac af ontar coSTCO WHOLESALE CORPORATION ASH FLOWS CONSOLIDATE amountr in millianal Weeks Ended Weeks Ended 2 Weeks Ended Senoember 2 Septambar 3, 2017 August 28, 2010 2010 CASFLOWS FROM OPERATING ACTIMTIES Net inome incudrg roncorolng intereets 175 2714 tincome includingg noncontroing interests o net caeh provided by operating actvites Deomens oe sad amodztor LA77 1371 250 Stock-besad comcarsaton 54. 514 450 (57) ,741 C ioch cwing adles no Changes in operaang apets and ljabinesa Marchandse Inventories 313 Ctw aling assels and idi, rel 547 Net cash pronded by teeatng actmtes 32 774 ,25 CTIMTIES 41 1 UNt (1,2/91 ... Maturties and sales of short term investments 1.078 225 170 960 (25021 040 rpcnty and cquiemene Net cash used in inuesne ecies 2947 (2,368 12345) CASH FLOWS FROM FINANCING ACTIVITIES 2.8 Proceeds fromn short-tem barrowngs ng tem deb (2 200 1 20. (2021 Tax wthnodngs an stnck-hasad amands (217) (220) 13201 cther fiarcing sctvities, net 4) (3,218 28 ) (2419 Nat cash used in fnancing actvtos s ON CASH AND CASH FQUIVAI FNTS Nt dteue n cee d c 1 160 equls 1422) CASH AND CASH EQUINALENTS ULGINNING OF YEAR 4.54 ,379 80 6 055 4 548 3379 CASH AND CASH EQUNALENTS END OF YEAR SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during te yaar far $1 $18, and S1R intest cpiiced in 2010 2017 and 2018, respecivey 131 4 12 Income taes, net 204 SUPPLEMENTAL DISCLOSURE OF NON-CA SH INVESTING AND FINANCING ACTIVITIES ot yat pald Caah dascans daciarad but not wat nad ON RRN ANCE EMEETS lamounts in millions, except par value and share data) September 2. 2018 September 3, 2017 ASSETS CURRENT ASSETS Cas and cash equivalenls ments 1 669 1432 Rocchables, not Merchandise invonmorkes 1.040 9.834 Othe 17 217 Total current assets PROPERTY AND EQUIPMENT 6,193 Land 15 177 s and improvements Equicment and fxdures 7 274 6.861 Corsiuctian in pragress 1,140 843 Less acumuled ceprecialion and amorlaion 11.003) (10,10) Net propery ecuipment 19,681 18.161 OTHER ASSETS TOTAL ASSETS IABLITIES AND FOUITY CURRENT LIABILITIES tt0s and heneftts 2 54 Accrued memper rewardse 1.057 951 1,624 Delened membership lees 1,48 17 485 Telal curent lsbllies 19.926 LONG-TERM DEBT, excluding current portion OTHER I 6.437 6573 7 727 25 260 COMMITMENTS AND CONTINGENCIES EQUITY rk $D 01 par value 100.003,0sharesa shares issued utstanding 204.000 sharcs Issuod and ounstancing Commen stock 50 01 parvaluc: 900 000 000 sharcs authortzed: 138 189 CO0 and c Addhicnal paid-in capta 6.10 5800 Accumulaled other comprehensive loss (1,199) (1,014) Rela Tetal Costco stockholders equity 12.799 10 778 Noncontiolng ineresis 304 301 11,079 1cal tTES AND EQUITY 19,109 The accompanying notes are an integral part of these consolidated financial statements 36 Iable of Contents ESALE CORPORATIE COSTCO CONSOLIDATED STATEMENTS OF INCOME (amounts in millions, except per share data) 53 Weeks Ended Weeks Ended Weeks Ended Sept 43 Au 2016 REVENUE Net salos 138,434 126,172 116,073 Me 129.025 113719 Talal revenue OPERATING EXPENSES Merchandise costs 123.152 111,882 102.901 Solling, goneral and administrative 13.876 12.950 12 068 Pre 2 672 4 400 4 111 Operating incne OTHER INCOME (EXPENSE) Interest expense Intarast income and other, nat (159) (134) (133) 121 62 80 INC XES Pravisian fer incame laxe 1.283 1325 1.243 Net income including noncontrolling interests 3,179 2,714 2,376 Net income attributable to noncontrolling interests (45% (35) (26) 2.679 NET INCOME ATTRIBUTABLE TO COSTCO 3, 134 S 2,350 NE EPER COMMON SHARE ATTRIBUTABLE TO COSTCO: 7.15 S 6.11 536 08 6.22 Diluted Shares used in calculation (0O0's Basic 438,515 438.43 438.585 41,834 140 9 441.263 Uilutod CASH DIVIDENDS DECLARED PER COMMON SHARE 2.14 S 890 170 The accompanying notes are an integral part of these consolidated financial statements. 37 Table of Contenb Company Target Accounting II Company Analysis Project Current and Long-term Liabilities Questions Refer to the notes to the financial statements. The first note, "Summary of Significant Accounting Policies," provides information about the company's liabilities. You will also need to refer to the other notes to the financial statements and to the financial statements them selves in order to answer the following questions. THE BASICS 1 What is the amount of the company's current liabilities? a. This year b. Last year What is the amount of the company's long-term liabilities? 2 This year a. b. Last year 3. Refer to the notes to the financial state ments. Does the company report any Capital leases. a. If yes what is the amount of the capital lease obligation (liability 1) This year 2) Last year Refer to the notes to the financial statements. Does the company report any operating leases? 4 What is the amount of total cash flow commitment under these operating leases? a. ANALYSIS Calculate the following ratios for both years presented in the balance sheet Show your computations. A. Current ratio = Current Assets/ Current Liabilities 1. Current year 2. Prior Year Debt to total Assets Ratio Total Liabilities/ Total Assets. B. 1 Current year Prior Year 2 C. Times Inte rest Earned (Net income + Interest Expense Tax Expense) / Interest expense. Current year 1 Prior Year 2