Walmart Target Common size comparative analysis-Cash Flow Common size comparativ
ID: 2330099 • Letter: W
Question
Walmart
Target
Common size comparative analysis-Cash Flow
Common size comparative analysis- Cash Flow
For the year ended January 31, 2018
For the year ended February 3, 2018
Details
2018
Details
2018
$
$
Net Income
$9,862,000
Net Income
$2,934,000
Cash Flows-Operating Activities
Cash Flows-Operating Activities
Depreciation
$10,529,000
Depreciation
$2,445,000
Net Income Adjustments
$4,042,000
Net Income Adjustments
$229,000
Changes in Operating Activities
Changes in Operating Activities
Accounts Receivable
($1,074,000)
Accounts Receivable
0
Changes in Inventories
($140,000)
Changes in Inventories
($348,000)
Other Operating Activities
0
Other Operating Activities
($168,000)
Liabilities
$4,457,000
Liabilities
$1,757,000
Net Cash Flow-Operating
$28,337,000
Net Cash Flow-Operating
$6,923,000
Cash Flows-Investing Activities
Cash Flows-Investing Activities
Capital Expenditures
($10,051,000)
Capital Expenditures
($2,533,000)
Investments
0
Investments
($55,000)
Other Investing Activities
$991,000
Other Investing Activities
($487,000)
Net Cash Flows-Investing
($9,060,000)
Net Cash Flows-Investing
($3,075,000)
Cash Flows-Financing Activities
Cash Flows-Investing Activities
Sale and Purchase of Stock
($8,304,000)
Sale and Purchase of Stock
($938,000)
Net Borrowings
($1,437,000)
Net Borrowings
($1,441,000)
Other Financing Activities
($3,320,000)
Other Financing Activities
0
Net Cash Flows-Financing
($19,875,000)
Net Cash Flows-Financing
($3,717,000)
Effect of Exchange Rate
$487,000
Effect of Exchange Rate
0
Net Cash Flow
($111,000)
Net Cash Flow
$131,000
· What were the companies’ cash flows from operations? Were they positive?
· Were operating cash flows smaller or larger than net income?
· What are the major differences between operating cash and net income?
· Did the company purchase new property and equipment (‘Capital expenditures’) during the years?
· Did the company issue new debt during the year or was the debt repaid? (Hint: We must sometimes sum one or more-line items on this statement to determine total net debt activity.)
· Did the company issue new stock?
· Did the company pay dividends?
Walmart
Target
Common size comparative analysis-Cash Flow
Common size comparative analysis- Cash Flow
For the year ended January 31, 2018
For the year ended February 3, 2018
Details
2018
Details
2018
$
$
Net Income
$9,862,000
Net Income
$2,934,000
Cash Flows-Operating Activities
Cash Flows-Operating Activities
Depreciation
$10,529,000
Depreciation
$2,445,000
Net Income Adjustments
$4,042,000
Net Income Adjustments
$229,000
Changes in Operating Activities
Changes in Operating Activities
Accounts Receivable
($1,074,000)
Accounts Receivable
0
Changes in Inventories
($140,000)
Changes in Inventories
($348,000)
Other Operating Activities
0
Other Operating Activities
($168,000)
Liabilities
$4,457,000
Liabilities
$1,757,000
Net Cash Flow-Operating
$28,337,000
Net Cash Flow-Operating
$6,923,000
Cash Flows-Investing Activities
Cash Flows-Investing Activities
Capital Expenditures
($10,051,000)
Capital Expenditures
($2,533,000)
Investments
0
Investments
($55,000)
Other Investing Activities
$991,000
Other Investing Activities
($487,000)
Net Cash Flows-Investing
($9,060,000)
Net Cash Flows-Investing
($3,075,000)
Cash Flows-Financing Activities
Cash Flows-Investing Activities
Sale and Purchase of Stock
($8,304,000)
Sale and Purchase of Stock
($938,000)
Net Borrowings
($1,437,000)
Net Borrowings
($1,441,000)
Other Financing Activities
($3,320,000)
Other Financing Activities
0
Net Cash Flows-Financing
($19,875,000)
Net Cash Flows-Financing
($3,717,000)
Effect of Exchange Rate
$487,000
Effect of Exchange Rate
0
Net Cash Flow
($111,000)
Net Cash Flow
$131,000
Explanation / Answer
1) The cash flows from operations were: Wallmart- $28,337,000 Target- $6,923,000 Yes, they were positive. 2) Operating cash flows were larger than net income. 3) Major differences between operating cash flow and net income are: *Operating cash flow excludes depreciation, which is a non-cash expense. *Operating cash flow provides for changes in the current assets and current liabilities. 4) Yes, the companies purchased new property and equipment during the year. The are reported as capital expenditures in the 'Investing Section' of the statement of cash flows. 5) Only 'net borrowings' are shown and it can be presumed that the companies have both issued new debt and repaid debt. 6) It is mentioned as 'sale and purchase of stock' which description tells that new stock was issued. 7) No, the companies did not pay dividends.
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