Forecasting the Statement of Cash Flows Following are the income statements and

Question

Forecasting the Statement of Cash Flows
Following are the income statements and balance sheets of Best Buy Co., Inc.

Refer to the financial information above for Best Buy Co., Inc. Prepare a forecast of its financial year 2012 statement of cash flows. (Hint: Use net income including noncontrolling interests to begin the statement of cash flows. Use negative signs in answers when appropriate.)

Round all answers to the nearest whole number. Use negative signs with answers, when appropriate.

Income Statement,
Fiscal Years Ended ($ millions) 2012
Estimated Feb. 26,
2011 Revenue $53,288 $50,272 Cost of goods sold 39,859 37,611 Restructuring charges - cost of goods sold -- 24 Gross profit 13,429 12,637 Selling, general and administrative expenses 10,924 10,325 Restructuring charges -- 198 Goodwill and tradename impairment -- -- Operating income 2,505 2,114 Other income (expenses) Investment income and other 51 51 Interest expense (87) (87) Earnings before income tax expense and equity in income of affiliates 2,469 2,078 Income tax expense 849 714 Equity in income of affiliates 2 2 Net earnings including noncontrolling interests 1,622 1,366 Net earnings attributable to noncontrolling interests (105) (89) Net earnings attributable to Best Buy Co., Inc. $1,517 $1,277

Explanation / Answer

Net income including noncontrolling interests 256 Add: depreciation 1219 Add: amortization 63 Change in Accounts receivable 157 Change in Inventories 338 Change in Other current assets 69 Change in Other long-term assets 799 Change in Accounts payable 275 Change in Unredeemed gift card liabilities 6 Change in Accrued compensation and related expenses 16 Change in Accrued liabilities 74 Change in Accrued income taxes 10 Net cash from operating activities 3282 Capital expenditures -799 Increase in Short-term investments -815 Net cash from investing activities -1614 Dividends -237.52 Payments of LT debt -37 Net cash from financing activities -274.52 Net change in cash 1393.48 Beginning cash 1103 Ending cash 2496.48

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