nalysis and Interpretation of Profitability
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) | 2011 | 2010 | 2009 |
| Sales | $ 9,310 | $ 8,258 | $ 8,272 |
| Credit card revenues | 390
|
369
|
301
|
| Total revenues | 9,700 | 8,627 | 8,573 |
| Cost of sales and related buying and occupancy costs | (5,897) | (5,328) | (5,417) |
| Selling, general and administrative expenses | |||
| Retail | (2,412) | (2,109) | (2,103) |
| Credit | (273)
|
(356)
|
(274)
|
| Earnings before interest and income taxes | 1,118 | 834 | 779 |
| Net interest expense | (127)
|
(138)
|
(131)
|
| Earnings before income taxes | 991 | 696 | 648 |
| Income tax expense | (378)
|
(255)
|
(247)
|
| Net earnings | $ 613 | $ 441 | $ 401 |
| NORDSTROM, INC. Consolidated Balance Sheets |
||
|---|---|---|
| ($ millions) | January 29, 2011 | January 30, 2010 |
| Assets | ||
| Current Assets | ||
| Cash and cash equivalents | $ 1,506 | $ 795 |
| Accounts receivable, net | 2,026 | 2,035 |
| Merchandise inventories | 977 | 898 |
| Current deferred tax assets, net | 236 | 238 |
| Prepaid expenses and other | 79
|
88
|
| Total current assets | 4,824 | 4,054 |
| Land, buildings and equipment, net | 2,318 | 2,242 |
| Goodwill | 53 | 53 |
| Other assets | 267
|
230
|
| Total assets | $ 7,462 | $ 6,579 |
| Liabilities and Shareholders’ Equity | ||
| Current liabilities | ||
| Accounts payable | $ 846 | $ 726 |
| Accrued salaries, wages and related benefits | 375 | 336 |
| Other current liabilities | 652 | 596 |
| Current portion of long-term debt | 6
|
356
|
| Total current liabilities | 1,879 | 2,014 |
| Long-term debt, net | 2,775 | 2,257 |
| Deferred property incentives, net | 495 | 469 |
| Other liabilities | 292 | 267 |
| Shareholders’ equity | ||
| Common stock, no par value | 1,168 | 1,066 |
| Retained earnings | 882 | 525 |
| Accumulated other comprehensive income (loss) | (29)
|
(19)
|
| Total shareholders’ equity | 2,021
|
1,572
|
| Total liabilities and shareholders’ equity | $ 7,462 | $ 6,579 |
(a) Compute net operating profit after tax (NOPAT) for 2011. Assume that the combined federal and statutory rate is: 37.0%. (Round your answer to the nearest whole number.)
2011 NOPAT = $
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