Chapter_14web - EXERCISES FOR CHAPTER 14 With Solutions...

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EXERCISES FOR CHAPTER 14 With Solutions Home Depot At the time that of its 10-Q filing of financial statements for the first half of its January 2002 fiscal year, Home Depot’s shares traded at $50 per share. The following are summaries from those financial statements. Balance Sheet, July 29, 2001 (in millions of dollars) Financial liabilities 1,320 Operating assets 23, 457 Operating liabilities 6,709 Financial assets 1,221 Common equity (on 2,336 million outstanding shares) 16,649 24,678 24,678 Statement of Earnings, Six Months Ended, July 29, 2001 (in millions of dollars) Net sales 26,776 Cost of Merchandise Sold 18,795 Gross Profit 7,981 Operating Expenses: Selling and Store Operating 4,963 Pre-Opening 59 General and Administrative 436 Total Operating Expenses 5,458 Operating Income 2,523 Interest Income (Expense): Interest and Investment Income 22 Interest Expense (11) Interest, Net 11 Earnings Before Income Taxes 2,534 Income Taxes 978 Net Earnings 1,556
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According to financial statement footnotes, Home Depot’s statutory tax rate (combined Federal and State rates) is 39%. Other comprehensive income (not in net earnings above) is negligible. Use a required six-month return for operations of 4% in calculations below. (a)
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This note was uploaded on 10/07/2010 for the course ECTCS ec12947322 taught by Professor Johnathayeri during the Spring '10 term at Life.

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Chapter_14web - EXERCISES FOR CHAPTER 14 With Solutions...

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