chapter_08 - Chapter 8 Profitability TO THE NET 1. a....

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Unformatted text preview: Chapter 8 Profitability TO THE NET 1. a. Hershey Foods This information cannot be obtained from the 10-K of Hershey Foods. They incorporate this information by reference. The audited consolidated financial statements of the corporation and its subsidiaries and the Report of Independent Public Accountants thereon, as required to be filed with this report, are set forth in item 8 of this report and are incorporated therein by reference to specific pages of the corporations Annual Report to Stockholders included as Appendix A to the Proxy statement and filed as Exhibit 13 hereto. b. Same answer as (a) incorporated by reference. Note: Hershey Foods Corporation released a combined proxy statement and annual report. It was titled Proxy Statement and 2001 Annual Report to Stockholders. Using this document the answer to (a) is: $207,156,000 (2001) $334,543,000 (2000) $460,310,000 (1999) Using this document the answer to (b) is: $1.165 (2001) $1.08 (2000) $1.00 (1999) Using the SEC cite ( www.sec.gov ), select DEF14A, filed March 15, 2002, other definitive proxy statements. The required information can be located with this proxy statement. 2. General Electric a. SIC 3600 Electronic & Other Electrical Equipment b. $14,128,000,000 (2001) $12,735,000,000 (2000) $10,717,000,000 (1999) 187 c. 1. Under Note 1 Accounting changes at January 1, 2001, GE and GECs adopted Statement of Financial Accounting Standards (SFAS) 133, Accounting for Derivative Instruments and Hedging Activities, as amended. 2. The year 2001 has been reported using the new standard, while prior years have been reported using the prior standard. The net effect related to the prior years is reported in the year of change (2001). 3. a. Wal*Mart Fiscal January 31, 2002 Fiscal January 31, 2001 (In Millions) Net sales Cost of sales Gross profit $217,799 171,562 $ 46,237 $191,329 150,255 $41,074 b. K-Mart Year Ended* January 31, 2002 Year Ended** January 31, 2001 (In Millions) Net sales Cost of sales Gross profit $36,151 29,936 $ 6,215 $37,028 29,658 $ 7,370 * Included 52 weeks ** Included 53 weeks c. Wal*Mart (In Millions) Gross Profit Net Sales $ 46,237 $217,799 21.23% $ 41,074 $191,329 21.47% K-Mart (In Millions) Gross Profit Net Sales $ 6,215 $36,151 17.19% $ 7,370 $37,028 19.90% Wal*Mart has a materially better gross profit than does K-Mart. This gives Wal*Mart a material profitability advantage. 188 QUESTIONS 8- 1. Profits can be compared to the sales from which they are the residual. They can be compared to the assets that generate sales. Or, they can be viewed as return to the owner. Each measure looks at profits differently. The trends might move in different directions, depending on the base....
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This note was uploaded on 07/12/2011 for the course FINANCE 7015 taught by Professor Elmo during the Spring '11 term at North Central Technical College.

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chapter_08 - Chapter 8 Profitability TO THE NET 1. a....

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