review income statements, balance sheets, and financial ratios
Based on several problems from the textbook, this assignment provides an opportunity to review income statements, balance sheets, and financial ratios and consider how they can be applied to decision making.
- Compute the financial ratios for Problem 17-B5 on page 738.
- Create an Excel spreadsheet to calculate financial ratios for Gap Inc., P.
Gap, Inc. is a leading global specialty apparel company with 3,263 company- operated and franchise store locations in 2012. The company was established in 1969 and has several well-known brand names such as Gap, Banana Republic, and Old navy. Excerpts from the company’s annual report for the fiscal year ended January 28, 2012. Gap paid cash dividends of $.45 per common share in fiscal 2012 and an average of 529 million shares were outstanding during the year Assume that gap has no stock options or convertible securities. The company’s market price on January 28 2012 was $18.93 per share. Compute the following financial ratios for fiscal 2012: Current ratio Total debt to equity Gross profit rate Return on sales Return on stockholders equity Earnings per share Price earnings Dividend yield Dividend payout Income statement for the year ended January 28, 2012 Net sales $14,549 Cost of sales 9,275 Gross profit $5,274 Operating expenses 3,3836 Operating income 1,438 Interest expenses, net 69 Income before income taxes $1,369 Income taxes 536 Net income $833 Balance sheet January 8, 2012 January 29, 2011 Assets Cash and cash equivalents $1,885 $1,561 Inventories 1,615 1,620 Other current assets (summarized”) 809 745 Total current assets $4,309 $3,926 Property and equipment (net) 2,523 2,563 Other assets 590 576 Total assets $7,422 $7,065
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Posted 17 Dec 2017 09:12 AM
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