Question

Home Depot Inc. Dollar amounts in Miltions Jan. 2a 2016 | Jan. 29,20171 Balance Sheets 4 Current assets: Jn2g 2018- Jan. 29, 2017 Cash and cash equivalents 6 Receivables, net $2,538 2,029 12,549 608 3,595 1,952 2,748 8 Other aurrent assets Total current assets 10 11 Net property and equipment 12 Goodwi 13 Other assets 933 22,075 2,275 1,246 44,529 21,914 2,093 4957% 611% 4 Total assets 966 16 Current Liabilities 17 Short-term debt 18 Accounts payable 19 Accrued salaries and related 20 Sales taxes payable 21 Delerred revenue 1,559 7,244 1,640 520 1,484 508 1669 25 542 195 2 Income taxes payable 54 1,202 170 Current instalments of long-term debt 24 Other accrued expenses 25 Total current liablities 27 Long-term debt, excluding current installments 28 Deferred income taxes 22,349 296 24,267 440 54.50 Other long-term liabilities 4 88 30 Total Eabilities Common stock, par value $0.05, authorized: 10,000 shares, issued: 1,780 shares at January 28, 89 2018 and 1,776 shares at January 29, 2017 020% 22 89% 99 68% 0 20% 22 78% 82 67% 33 Paid-in capital 10,192 39,935 566 9,787 35,519 867 14 Retained eamings Accumulated other comprehensive loss 36 Treasury stock, at cost, 622 shares at January 28, 2018 and 573 shares at January 29, 2017 7 Total stockholders equity -93 55% 10 08% 38 Total liabilities and stockholders' equity

Answer 1

Following are the ratios for the two years :-

Ratios	Jan 28, 2018	Jan 29, 2017
Current ratios = (current asset/current liabilities )	1.17 (18933/16194)	1.25 (17724/14133)
Liabilities-to-equity (total liabilities / stockholders equity)	29.63 (43075/1454)	8.92 (38633/4333)
Times interest earned (EBIT/interest)	13.89 (14681/1057)	13.81 (13427/972)
Return on equity (Net earning / stockholder equity)	298.25 % (8630/{(1454+4333)/2}	149.44 % (7957/{4333+6316)/2}
Profit margin (net earning/sales)	8.55% (8630/100904)	8.41% (7957/94595)
Asset turnover (sales /average asset)	2.31 (100904/[{44529+42966}/2])	2.23 (94595/[{42966+41973}/2]
Financial leverage (average asset/average equity)	15.12 [{(44529+42966)/2}/{(1454+4333)/2}]	7.98 [{(42966+41973)/2}/{(4333+6316)/2}]
Return on equity (profit margin x asset turnover x financial leverage )	298.63% (0.0855x2.31x15.12)	149.66% (0.0841x2.23x7.98)