Two-Year-Ahead Forecasting of Financial Statements Following are the financial statements of Target Corp.

Consolidated Statements of Operations
For fiscal year ended (millions)	Jan. 29, 2011	Jan. 30, 2010
Sales	$65,786	$63,435
Credit card revenues	1,604	1,922
Total revenues	67,390	65,357
Cost of sales	45,725	44,062
Selling, general and administrative expenses	13,469	13,078
Credit card expenses	860	1,521
Depreciation and amortization	2,084	2,023
Earnings before interest expense and income taxes	5,252	4,673
Net interest expense
Nonrecourse debt collateralized by credit card receivables	83	97
Other interest expense	677	707
Interest income	(3)	(3)
Net interest expense	757	801
Earnings before income taxes	4,495	3,872
Provision for income taxes	1,575	1,384
Net earnings	$2,920	$2,488

Consolidated Statements of Financial Position
In millions	Jan. 29, 2011	Jan. 30, 2010
Assets
Cash and cash equivalents	$ 1,712	$ 2,200
Credit card receivables	6,153	6,966
Inventory	7,596	7,179
Other current assets	1,752	2,079
Total current assets	17,213	18,424
Property and equipment
Land	5,928	5,793
Buildings and improvements	23,081	22,152
Fixtures and equipment	4,939	4,743
Computer hardware and software	2,533	2,575
Construction-in-progress	567	502
PPE, at cost	37,048	35,765
Accumulated depreciation	(11,555)	(10,485)
Prooerty and equipment, net	25,493	25,280
Other noncurrent assets	999	829
Total assets	$ 43,705	$ 44,533
Liabilities and Shareholders' investment
Accounts payable	$6,625	$6,511
Accrued expenses and other current liabilities	3,326	3,120
Unsecured debt and other borrowings	119	796
Nonrecourse debt collateralized by credit card receivables	--	900
Total current liabilities	10,070	11,327
Unsecured debt and other borrowings	11,653	10,643
Nonrecourse debt collateralized by credit card receivables	3,954	4,475
Deferred income taxes	934	835
Other noncurrent liabilities	1,607	1,906
Total noncurrent liabilities	18,148	17,859
Shareholders' investment
Common stock	59	62
Additional paid-in-capital	3,311	2,919
Retained earnings	12,698	12,947
Accumulated other comprehensive loss	(581)	(581)
Total shareholders' investment	15,487	15,347
Total liabilities and shareholders' investment	$ 43,705	$ 44,533

Forecast Target's fiscal year ended 2012 and 2013 income statements. Use the same forecasting assumptions for both years.

Assume no change for net interest expense.

We forecast Target's financials using the following forecast assumptions for both years:

Sales (growth rate)	4%
Credit card revenues (we assume the same growth rate for sales)	4%
Cost of sales (% sales*)	69.5%
Selling, general and administrative expenses (% sales)	20.5%
Credit card expenses (% credit card revenues)	53.6%
Depreciation and amortization (% PY PPE, at cost)	5.8%
Nonrecourse debt interest expense (no change)	$83
Other interest expense (no change)	$677
Interest income (no change)	$3
Provisions for income taxes (% pretax income)	35.0%

* Note the distinction between sales and credit card revenues.

Instructions: Round answers to the nearest whole number. Do notuse negative signs with answers. Remember to use rounded forecasted sales with subsequent calculations.

NOTE: Do not adjust net interest expense after "plug" is computed in forecasted balance sheet below. Assume net interest expense will not change.

Consolidated Statements of Operations
For fiscal year ended (millions)	Jan. 29, 2011	2012 Est.	2013 Est.
Sales	$65,786	$Answer	$Answer
Credit card revenues	1,604	Answer	Answer
Total revenues	67,390	Answer	Answer
Cost of sales	45,725	Answer	Answer
Selling, general and administrative expenses	13,469	Answer	Answer
Credit card expenses	860	Answer	Answer
Depreciation and amortization	2,084	Answer	Answer
Earnings before interest expense and income taxes	5,252	Answer	Answer
Net interest expense
Nonrecourse debt collaterized by credit card receivables	83	Answer	Answer
Other interest expense	677	Answer	Answer
Interest income	3	Answer	Answer
Net interest expense	757	Answer	Answer
Earnings before income taxes	4,495	Answer	Answer
Provisions for income taxes	1,575	Answer	Answer
Net earnings	$ 2,920	$Answer	$Answer

Forecast Target's fiscal year ended 2012 and 2013 balance sheets. Use the same forecasting assumptions for both years.

Assume no change for: nonrecourse debt collateralized by credit card receivables (current and noncurrent), deferred income tax liability, common stock, additional paid-in-capital, and accumulated other comprehensive income.

We forecast Target's financials using the following forecast assumptions for both years:

Cash (% sales)	2.6%
Credit card receivables (% sales)	9.4%
Inventory (% sales)	11.5%
Other current assets (% sales)	2.7%
Other noncurrent assets (% sales)	1.5%
Accounts payable (% sales)	10.1%
Accrued and other current liabilities (% sales)	5.1%
Deferred income taxes (no change)	$934
Other noncurrent liabilities (% sales)	2.4%
Common stock (no change)	$59
Additional paid-in-capital (no change)	$3,311
Accumulated other comprehensive loss (no change)	$581
Capital expenditures (% sales)	3.2%
Depreciation & Amortization (% prior year PPE, at cost)	5.8%
Dividends (% net income)	20.9%
Current Maturities L-T Debt for 2011	$106
Current Maturities L-T Debt for 2012	$2,251
Current Maturities L-T Debt for 2013	$3,812

Instructions: Round answers to the nearest whole number. Do notuse negative signs with answers. Remember to use rounded forecasted sales with subsequent calculations.

Consolidated Statements of Financial Position
(In Millions)	Jan. 29, 2011	2012 Est.	2013 Est.
Assets
Cash and cash equivalents	$1,712	$Answer	$Answer
Marketable securities (plug)	--	Answer	Answer
Credit card receivables	6,153	Answer	Answer
Inventory	7,596	Answer	Answer
Other current assets	1,752	Answer	Answer
Total current assets	17,213	Answer	Answer
PPE, at cost	37,048	Answer	Answer
Accumulated depreciation	11,555	Answer	Answer
Property and equipment, net	25,493	Answer	Answer
Other noncurrent assets	999	Answer	Answer
Total assets	$43,705	$Answer	$Answer
Liabilities and shareholders' equity
Accounts payable	$6,625	$Answer	$Answer
Accrued and other current liabilities	3,326	Answer	Answer
Unsecured debt and other borrowings	119	Answer	Answer
Short-term debt (plug)	--	Answer	Answer
Nonrecourse debt collateralized by credit card receivables	--	Answer	Answer
Total current liabilities	10,070	Answer	Answer
Unsecured debt and other borrowings	11,653	Answer	Answer
Nonrecourse debt collateralized by credit card receivables	3,954	Answer	Answer
Deferred income taxes	934	Answer	Answer
Other noncurrent liabilities	1,607	Answer	Answer
Total noncurrent liabilities	18,148	Answer	Answer
Shareholders' investment
Common stock	59	Answer	Answer
Additional paid-in-capital	3,311	Answer	Answer
Retained earnings	12,698	Answer	Answer
Accumulated other comprehensive loss	581	Answer	Answer
Total shareholders' investment	15,487	Answer	Answer
Total liabilities and shareholders' investment	$43,705	$Answer	$Answer