Accounting

Refer to the Lowes and Home Depot financial statements attached:

Using only those financial statements, answer the questions that follow:

1. Compute the following ratios for both companies for the Fiscal Year 2016 (ending in early 2017)

a. Return on Equity

b. Return on Assets

c. Disaggregate ROA into profit margin and asset turnover

d. Accounts Receivable Turnover & receivable collection period

e. Inventory Turnover & inventory on hand period

f. Current ratio

g. Long term debt to total assets ratio

h. Long term debt to shareholders’ equity ratio

i. Interest coverage ratio

2. Each company gives details of its operating lease payments. Capitalize the value of these payments and assess its impact on the ratios calculated in items g and h above.

3. Write a brief report comparing and evaluating the performance of these two companies in Fiscal 2016. Restrict your analysis to the discussion of information already calculated for 1 and 2 above and to no more than 2 pages in Times New Roman 12 font double spaced with 1 inch margins all around.

Problem 3:

The December 28, 2013 balances in various accounts of Cabela’s Inc. shows the amounts below. All necessary adjustment entries have been made.

Prepare the company’s income statement and balance sheet for December 28, 2013.