solution
Analysis and Interpretation of ROE and RNOA with No Noncontrolling Interest
Balance sheets and income statements for Nordstrom, Inc., follow. Refer to these financial statements to answer the requirements.
| Nordstrom, Inc. Consolidated Statements of Earnings |
|||
|---|---|---|---|
| For Fiscal Years Ended ($ millions) | 2016 | 2015 | 2014 |
| Net Sales | $14,095 | $13,110 | $12,166 |
| Credit card revenues | 342 | 396 | 374 |
| Total revenues | 14,437 | 13,506 | 12,540 |
| Cost of sales and related buying and occupancy costs | (9,168) | (8,406) | (7,737) |
| Selling, general and administrative expenses | (4,168) | (3,777) | (3,453) |
| Earnings before interest and income taxes | 1,101 | 1,323 | 1,350 |
| Interest expense, net | (125) | (138) | (161) |
| Earnings before income taxes | 976 | 1,185 | 1,189 |
| Income tax expense | (376) | (465) | (455) |
| Net earnings | $600 | $720 | $734 |
| Nordstrom, Inc. Consolidated Balance Sheets |
||
|---|---|---|
| in millions | Jan. 30, 2016 | Jan. 31, 2015 |
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | $595 | $827 |
| Accounts receivable, net | 196 | 2,306 |
| Merchandise inventories | 1,945 | 1,733 |
| Current deferred tax assets, net | 0 | 256 |
| Prepaid expenses and other | 278 | 102 |
| Total current assets | 3,014 | 5,224 |
| Land, buildings and equipment, net | 3,735 | 3,340 |
| Goodwill | 435 | 435 |
| Other assets | 514 | 246 |
| Total assets | $7,698 | $9,245 |
| Liabilities and equity | ||
| Current liabilities | ||
| Accounts payable | $1,324 | $1,328 |
| Accrued salaries, wages and related benefits | 416 | 416 |
| Other current liabilities | 1,161 | 1,048 |
| Current portion of long-term debt | 10 | 8 |
| Total current liabilities | 2,911 | 2,800 |
| Long-term debt, net | 2,795 | 3,123 |
| Deferred income taxes and other liabilities | 540 | 510 |
| Other liabilities | 581 | 372 |
| Shareholders’ equity | ||
| Common stock, no par value: 1,000 shares authorized; | ||
| 173.5 and 190.1 shares issued and outstanding | 2,539 | 2,338 |
| Retained earnings | (1,610) | 166 |
| Accumulated other comprehensive loss | (58) | (64) |
| Total shareholders’ equity | 871 | 2,440 |
| Total liabilities and shareholders’ equity | $7,698 | $9,245 |
HINT: For Sales use “Total revenues” for your computations, when applicable.
Save your time - order a paper!
Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines
Order Paper Now(a) Compute net operating profit after tax (NOPAT) for 2016. Assume that the combined federal and state statutory tax rate is 37%.
Round to the nearest whole number.
2016 NOPAT = $Answer
(b) Compute net operating assets (NOA) for 2016 and 2015.
2016 NOA = $Answer
2015 NOA = $Answer
(c) Compute RNOA, net operating profit margin (NOPM) and net operating asset turnover (NOAT) for 2016.
Do not round until your final answer. Round answer to two decimal places.
2016 RNOA = Answer%
2016 NOPM = Answer%
2016 NOAT = Answer
(d) Compute net nonoperating obligations (NNO) for 2016 and 2015.
2016 NNO = $Answer
2015 NNO = $Answer
(e) Compute return on equity (ROE) for 2016.
Round answer to two decimal places.
2016 ROE = Answer%
(f) Infer the nonoperating return component of ROE for 2016.
Use above answers to calculate. Round answer to two decimal places.
2016 nonoperating return = Answer%
"Looking for a Similar Assignment? Get Expert Help at an Amazing Discount!"
