The following table gives abbreviated balance sheets and income statements for Target. At the end...
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Finance
The following table gives abbreviated balance sheets and income statements for Target. At the end of fiscal 2009, Target had 2,832 million shares outstanding with a share price of $94. The company's weighted-average cost of capital was about 5%. Assume a tax rate of 21%.
Balance Sheet (figures in $ millions)
Fiscal 2009
Fiscal 2008
Assets
Current assets:
Cash and marketable securities
$ 9,465
$ 7,722
Accounts receivable
6,284
6,283
Inventories
44,435
44,269
Other current assets
1,622
3,623
Total current assets
$ 61,806
$ 61,897
Fixed assets:
Net fixed assets
$ 127,049
$ 111,395
Other long-term assets
47,640
46,003
Total assets
$ 236,495
$ 219,295
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable
$ 46,973
$ 47,060
Other current liabilities
30,817
30,417
Total current liabilities
$ 77,790
$ 77,477
Long-term debt
43,714
43,520
Other long-term liabilities
33,439
18,664
Total liabilities
$ 154,943
$ 139,661
Total shareholders' equity
81,552
79,634
Total liabilities and shareholders equity
$ 236,495
$ 219,295
Income Statement (figures in $ millions)
Net sales
$ 523,964
Cost of goods sold
394,605
Selling, general, and administrative expenses
97,804
Depreciation
10,987
Other income/expenses
2,147
Earnings before interest and taxes (EBIT)
$ 22,715
Interest expense
2,599
Taxable income
$ 20,116
Tax
4,915
Net income
$ 15,201
Calculate the economic value added.
Note: Do not round intermediate calculations. Enter your answer in millions rounded to nearest whole number.
Calculate the return on start-of-the-year capital.
Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.
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