PLEASE HELP, I AM LOST!!! Best Buy Co., Inc\'s consolidated balance sheets from
ID: 2661023 • Letter: P
Question
PLEASE HELP, I AM LOST!!!
Best Buy Co., Inc's consolidated balance sheets from its 2011 annual report are presented in Exhibit 5-3. a) Using the balance sheets, prepare a vertical common size analysis for 2011 and 2010. Use total assets as a base. b) Using the balance sheets, prepare a horizontal common size analysis for 2011 and 2010. Use 2010 as the base. c) comment on significant trends that appear in (a) and (b).
February 26, 2011 February 27, 2010
Assets Assets
Current assets Current assets
Cash & cash equivalents $1,103 Cash & cash equivalents $1,826
Short-term investments 22 Short-term investments 90
Receivables 2,348 Receivables 2,020
Merchandise inventories 5,897 Merchandise inventories 5,486
Other current assets 1,103 Other current assets 1,144
Total Current Assets 10,473 Total Current Assets 10,566
Property & Equipment
Land & buildings 766 Land & buildings 757
Leasehold improvements 2,318 Leasehold improvements 2,154
Fixures & equipment 4,701 Fixtures & equipment 4,447
Property under capital lease 120 Property under capital lease 95
7,905 7,453
Less accumulated depreciation 4,082 Less accumulated depreciation 3,383
Net property & equipment 3,823 Net property & equipment 4,070
Goodwill 2,454 Goodwill 2,452
Tradenames, Net 133 Tradenames, Net 159
Customer Relaionships, Net 203 Customer Relationships, Net 279
Equity & other investments 328 Equity & other investments 324
Other Assets 435 Other Assets 452
Total Assets $17,849 Total Assets $18,302
Liabilities and Equity
Current Liabilities
Accounts payable $4,894 Accounts payable $5,276
Unredeemed gift card liabilities 474 Unredeemed gift card liabilities 463
Accrued compensation & related expense 570 Accrued compensation & related expenses 544
Accrued liabilities 1,471 Accrued liabilities 1,681
Accrued income taxes 256 Accrued income taxes 316
Short-term debt 557 Short-term debt 663
Current portion of long-term debt 441 Current portion of long-term debt 35
Total Current Loabilities 8,663 Total Current Liabilities 8,978
Long-term Liabilites 1,183 Long-term Liabilites 1,256
Long-term Debt 711 Long-term Debt 1,104
Equity
Best Buy Co., Inc Shareholders' Equity
Preferred stock, $1.00 par value: Autorized-
400,000 shares; Issued and outstanding--none
Common stock, $0.10 par value; Autorized-
1.0 billion shares; Issued and outstanding--
392,590,000 and 418,815,000 share, respectively 39 42
Additional paid-in capital 18 Additional paid-in capital 441
Retained earnings 6,372 Retained earings 5,797
Accumulated other comprehsive income 173 Accumulated other comprehsinve income 40
Total Best Buy Co., Inc, shareholder's equity 6,602 Total Best Buy Co., Inc. shareholders equity 6,320
Noncontrolling interests 690 Noncontrolling interests 644
Total equity 7,292 Total equity 6,964
Total Liabilities and Equity $17,849 Total Liablities and Equity $18,302
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Consolidated Statements of Earnings
$ in millions, except per share amounts
Fiscal Years Ended Feb.26, 2011 Feb. 27, 2010 Feb. 28, 2009
Revenue $50,272 $49,694 $45,015
Cost of goods sold 37,611 37,534 34,017
Restructuring charges-cost of goods sold 24 ----- -----
Gross profit 12,637 12,160 10,998
Selling, general & administrative expenses 10,325 9,873 8,984
Restructuring charges 198 52 78
Goodwill & tradename impairment ------- ------- 66
Operating income 2,114 2,235 1,870
Other income (expense)
Investment income & other 51 54 35
Investment impairment -------- ----------- (111)
Interest expense (87) (94) (94)
Earnings before income tax expense & equity in
income of affiliates 2,078 2,195 1,700
Income tax expense 714 802 674
Equity in income of affiliates 2 1 7
Net earnings includingnoncontrolling interests 1,366 1,394 1,033
Net earnings attributable to noncontrolling interests (89) (77) (30)
Net earnings attributable to Best Buy Co., Inc $1,277 $1,317 $1,003
Earnings per share attributable to Best Buy Co. Inc.
Basic $3.14 $3.16 $2.43
Diluted $3.08 $3.10 $2.39
Weighted average common shares outstanding (in millions)
Basic 406.1 416.8 412.5
Diluted 416.5 427.5 422.9
Explanation / Answer
Best Buy Co., Inc. Vertical Common-Size Balance Sheet In Percentage* February 27, March 1, 2010 2011 Assets Current assets Cash and cash equivalents Short-term investments Receivables Merchandise inventories Other current assets Total current assets Property and equipment Land and buildings Leasehold improvements Fixtures and equipment t Property under capital lease Less accumulated depreciation Net property and equipment Goodwill Tradenames Customer relationships 3.1 .1 11.8 30.0 6.7 51.8 11.3 .5 4.3 36.9 4.6 57.5 4.8 12.7 25.7 .7 43.9 17.5 26.4 13.9 1.1 2.0 5.7 13.7 24.0 .5 44.0 18.0 25.9 8.5 0.8 Equity and other long-term investments Other assets Total assets 2.5 2.3 100.0 4.7 2.5 100.0 =================================================================================== In Percentage February 27, March 1,2010 2011 Liabilities and shareholders equity Current liabilities Accounts payable Unredeemed gift card liabilities Accrued compensation and related 31.6 3.0 33.7 4.2 expense Accrued liabilities Accrued income taxes Short-term debt Current portion of long-term debt Total current liabilities Long-term liabilities Long-term debt Minority interest Shareholders equity Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive 2.9 8.7 1.8 4.9 .3 53.3 7.0 7.1 3.2 2.9 7.6 3.2 1.2 .3 53.1 6.6 4.9 .3 .3 1.3 29.8 .3 .1 30.8 (loss) income Total shareholders equity (2.0) 29.3 (3.9) 35.1 Total liabilities and shareholders equity 100.0 100.0 ================================================================================================= b. Best Buy Co., Inc. Horizontal Common-Size Balance Sheet In Percentage February 27, March 1, 2009 2008 Assets Current assets Cash and cash equivalents Short-term investments Receivables 34.6 17.2 340.3 100.0 100.0 100.0 Merchandise inventories Other current assets Total current assets Property and equipment Land and buildings Leasehold improvements Fixtures and equipment Property under capital lease Less accumulated depreciation Net property equipment Goodwill Tradenames Equity and and other long-term investments Customer relationships Other assets Total assets 100.0 182.2 111.6 100.0 100.0 100.0 103.1 114.9 132.8 167.2 123.8 (120.2) 126.3 202.5 178.4 644.0 65.3 116.5 124.0 100.0 100.0 100.0 100.0 100.0 (100.0) 100.0 100.0 100.0 100.0 100.0 100.0 In Percentage February 28, March 1, 2009 2008 Liabilities and shareholders equity Current liabilities Accounts payable Unredeemed gift card liabilities Accrued compensation and related expense Accrued liabilities Accrued income taxes Short-term debt Current portion of long-term debt Total current liabilities Long-term liabilities Long-term debt Minority interests Shareholders equity Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive income Total shareholders equity Total liabilities and shareholders equity 116.3 90.2 100.0 100.0 123.1 141.7 69.6 501.9 163.6 124.6 132.3 179.6 1,282.5 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 2,562.5 119.9 100.0 100.0 100.0 N/A 103.5 124.0 100.0 100.0 100.0 ============================================================================================ c. Vertical Common-Size Assets: Material decrease in total current assets. This decrease was substantially in cash and equivalents and merchandise inventories. There was a material increase in receivables. Material increase in goodwill Material decrease in equity and other investments Liabilities: Material increase in short-term debt Material increase in long-term debt Material decrease in accumulated other comprehensive income Horizontal Common-Size Assets: Material increase in total current assets. This was caused by the increase in receivables. Material increase in property and equipment. This was caused by the increase in property under capital lease. Material increase in goodwill Material increase in tradenames Customer relationships was a new area Material increase in total assets Liabilities and shareholders equity: Material increase in total current liabilities. This was caused by the increase in accrued compensation and related expense, accrued liabilities, short-term debt and current portion of long-term debt. Material increase in long-term liabilities Material increase in long-term debt Material increase in minority interest Material increase in additional paid-in capital
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.