Question

Comparing Profitability and Turnover Ratios for Retail Companies Selected financial statement data for Best Buy Co., Inc., The Kroger Co., Nordstrom, Inc., Staples, Inc., and Walgreen Co. is presented in the following table: (5 millions) Sales revenue Cost of Sales Interest expense Net income Average receivables Average inventories Average PP&E Average total assets Best Buy Kroger Nordstrom Staples Walgreen $40,339 5108,465 $13,506 $22.492 $76,392 31,292 85.512 8.406 16,691 54,823 90 488 138 49 156 1,233 1,728 720 135 1932 1.294 1,191 2,489 1,883 2,925 5.275 5,670 1,632 2,236 6,464 2,447 17,403 3,145 1,788 12,198 14,635 29,919 8,910 10,744 36,332 Assume a statutory tax rate of 35% for all companies.

Answer 1

a)
			Best Buy	Kroger	Nordstorm	Staples	Walgreen
	A	Sales Revenue	$           40,339	$       1,08,465	$           13,506	$           22,492	$           76,392
	B	Net Income	$             1,233	$             1,728	$                 720	$                 135	$             1,932
	C	Average Assets	$           14,635	$           29,919	$             8,910	$           10,744	$           36,332
	D	ROA (B/C)	8.4%	5.8%	8.1%	1.3%	5.3%
	E	PM (B/A)	3.1%	1.6%	5.3%	0.6%	2.5%
	F	AT (A/C)	2.8	3.6	1.5	2.1	2.1
b)			Best Buy	Kroger	Nordstorm	Staples	Walgreen
	A	Sales Revenue	$           40,339	$       1,08,465	$           13,506	$           22,492	$           76,392
	B	Cost Of Goods Sold	$           31,292	$           85,512	$             8,406	$           16,691	$           54,823
	C	Average Account Receivables	$             1,294	$             1,191	$             2,489	$             1,883	$             2,925
	D	Average Invetories	$             5,275	$             5,670	$             1,632	$             2,236	$             6,464
	E	Average PP&E	$             2,447	$           17,403	$             3,145	$             1,788	$           12,198
	F	ART (A/C)	31.2	91.1	5.4	11.9	26.1
	G	INVT (B/D)	5.9	15.1	5.2	7.5	8.5
	H	PPET (A/E)	16.5	6.2	4.3	12.6	6.3
c)			Best Buy	Kroger	Nordstorm	Staples	Walgreen
	A	Sales Revenue	$           40,339	$       1,08,465	$           13,506	$           22,492	$           76,392
	B	Cost Of Goods Sold	$           31,292	$           85,512	$             8,406	$           16,691	$           54,823
	C	Gross Profit	$             9,047	$           22,953	$             5,100	$             5,801	$           21,569
	D	Gross Profit Margin (C/A)	22.4%	21.2%	37.8%	25.8%	28.2%

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