Student Name:
Instructor
Class:
McGraw-Hill/Irwin
Problem 01-01
Requirement 1:
GASLIGHT COMPANY
Income Statement
For the Year Ended December 31, 2011
Total sales revenue $126,000
Correct!
Requirement 2:
Ending retained earnings $22,060
Beginning retained earnings $0
Correct!
Requirement 3:
GASLIGHT COMPANY
Balance Sheet
At December 31, 2011
Assets:
Cash $24,500
Receivables from customers 10,800
Inventory of merchandise 81,000
Equipment 40,700
Total Assets $157,000
Total liabilities and stockholders’ equity $157,000
Liabilities: Correct!
For the Year Ended December 31, 2011
Statement of Retained Earnings
GASLIGHT COMPANY
Net income $32,060
Given Data P01-01:
GASLIGHT COMPANY
Cash 24,500$
Receivables from customers 10,800
Inventory of merchandise 81,000
Equipment owned, at cost less used portion 40,700
Accounts payable owed to suppliers 46,140
Student Name:
Instructor
Class:
McGraw-Hill/Irwin
Problem 01-02
BRIDGET’S LAWN SERVICE
Income Statement
For the Three Months Ended August 31, 2011
Revenues:
Lawn service – cash $12,300
– credit 700
Total revenues $13,000
Expenses:
Preparation of payroll tax forms 25
Insurance 125
Telephone 110
Interest expense on note paid 65
Equipment use cost (depreciation) 600
Given Data P01-02:
BRIDGET’S LAWN SERVICE
Paid for used pickup truck 1,500$
Paid for mowers, trimmers, and tools 900
Paid for gas, oil, and lubrication 940
Paid for pickup repairs 250
Paid for mower repair 110
Paid for miscellaneous supplies used 80
Paid for helpers 5,400
Required:
1.
2.
3. Growth during a period is calculated as:
This workbook is organized as follows:
Sheet Name Contents
CP1-3 (this worksheet) CP1-3 Problem Requirements
Industry Ratio Report Industry Ratio Report
AEO Balance Sheets American Eagle Outfitters, Inc. Consolidated Balance Sheets
AEO Statement of Operations American Eagle Outfitters, Inc. Consolidated Statements of Operations
AEO Income Statements American Eagle Outfitters, Inc. Consolidated Statements of Comprehensive Income
AEO Stmts of Stockholders’ Eq American Eagle Outfitters, Inc. Consolidated Statements of Stockholders’ Equity
AEO Statements of Cash Flow American Eagle Outfitters, Inc. Consolidated Statements of Cash Flows
Urban Balance Sheets Urban Outfitters, Inc. Consolidated Balance Sheets
Urban Income Statements
Urban Stmts of Stockholders’ Eq Urban Outfitters, Inc. Consolidated Statements of Stockholders’ Equity
Urban Stmts of Cash Flow Urban Outfitters, Inc. Consolidated Statements of Cash Flows
CP1-3 Comparing Companies within an Industry
Total assets is a common measure of the size of a company. Which company had the higher total assets at the end of
the most recent year? (Note: some companies will label a year that has a January year-end as having a fiscal
Net sales is also a common measure of the size of a company. Which company had the higher net sales for the most
recent year?
Which company had the highest growth in total assets during the most recent year? Which company had the highest
growth in net sales during the most recent year?
Liquidity
Current Ratio 2.55
Company
Name
Ticker
Symbol
Quick Ratio 1.38 ANF
ARO
Activity AEO
Inventory
Turnover
5.92 ANN
Days to Sell
70.897 days BEBE
Payable
GES
Profitability JCG
Gross Profit
Margin
38.99% LTD
Profit Margin
Net Profit
Margin
Return on
Equity
Return on
Assets
Quality of
0.07 MW
The Men’s Warehouse Inc
The Buckle Inc
Ross Stores Inc
Pacific Sunwear of California Inc
Operating
6.24% JWN
Income
0.72 URBN
Leverage WTSLA
Earned
Interest
16.39
Total
1.08
Total
1.92
Times Interest
16.33
Assets/Total
Dividends
Dividend
Payout
19.61%
Dividend Yield 2.22%
Other
Sales
Sales Growth 2.39%
Capital
Acquisitions
1.93
Abercrombie & Fitch
J. Crew Group Inc
bebe stores Inc
Ann Taylor Stores
Guess? Inc
COMPANIES USED IN INDUSTRY ANALYSIS
American Eagle Outfitters
Aeropostale Inc
INDUSTRY RATIO REPORT
Retail Family Clothing Stores
Wet Seal Inc.
Urban Outfitters Inc
Nordstrom, Inc.
Limited Brands Inc
Inventory
Receivables
Turnover
54.24 CHS
Average
Collection
15.07 days PSS
Fixed Asset
Turnover
5.76 DBRN
Total Asset
Turnover
1.90 FL
Accounts
6.43 GPS
Collective Brands Inc
Chico’s FAS Inc
Gap Inc
Foot Locker, Inc
Dress Barn Inc.
January 31, February 2,
(in thousands, except per share amounts) 2009 2008
$ 473,342 $ 116,061
10,511 503,878
294,928 286,485
41,471 31,920
59,660 35,486
45,447 47,004
925,359 1,020,834
$ 152,068 $ 157,928
$ 75,000 $ –
29,417 49,494
64,695 62,161
6,259 22,803
42,299 54,554
13,726 12,953
18,299 16,285
401,763 376,178
88,314 70,355
Notes payable
Current portion of deferred lease credits
Unredeemed stored value cards and gift certificates
Accrued rent
Other liabilities and accrued expenses
Deferred lease credits
Accrued income and other taxes
Accrued compensation and payroll taxes
Total current liabilities
Non-current liabilities:
39,898 44,837
24,670 35,846
152,882 151,038
– –
Preferred stock, $0.01 par value; 5,000 shares authorized; none issued and outstanding
LIABILITIES AND STOCKHOLDERS’ EQUITY
Non-current accrued income taxes
Commitments and contingencies
Accounts payable
Current liabilities:
Total non-current liabilities
Other non-current liabilities
Total current assets
Stockholders’ equity
Deferred income taxes
Prepaid expenses and other
Accounts and note receivable
AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED BALANCE SHEETS
Merchandise inventory
ASSETS
Short-term investments
Cash and cash equivalents
Current assets:
740,240 625,568
10,706 11,479
251,007 165,810
15,001 24,238
21,363 19,751
Non-current deferred income taxes
Other assets, net
Total assets
Property and equipment, at cost, net of accumulated depreciation and amortization
January 1, February 2, February 3,
(In thousands, except per share amounts) 2009 2008 2007
Net sales $ 2,988,866 $ 3,055,419 $ 2,794,409
income, net
17,790 37,626 42,277
Other-than-
temporary
22,889 – –
before
Provision for
income
117,980 236,362 241,708
Basic
income per
$ 0.87 $ 1.85 $ 1.74
Diluted
Income
297,041 636,381 629,067
income per
$ 0.86 $ 1.82 $ 1.70
Weighted average common shares outstanding – basic
205,169 216,119 222,662
Weighted average common shares outstanding – diluted
207,582 220,280 228,384
For the Years Ended
AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Gross profit 1,174,101 1,423,138 1,340,429
740,742 715,180 665,606
Depreciation
131,219 109,203 88,033
Operating
302,140 598,755 586,790
Other
CP1-3
Home
January 1, February 2, February 3,
(In thousands) 2009 2008 2007
$ 179,061 $ 400,019 $ 387,359
197 242 356
(378) 947 (191)
– – (177)
(27,649) 12,582 (1,180)
– – 878
(49,874) 13,771 (314)
Comprehensive income
Other comprehensive (loss) income
Reclassification adjustment for foreign currenty loss reasinzed in net
income realted to the disposition of National Logistics Services
AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Years Ended
Net income
transfer of investment securities from available-for-sale classification
Reclassification adjustment for gain realized in net income realted to the
Unrealized (loss) gain on investments, net of tax
Foreign currency translation adjustment
to trading classification, net of tax
related to ARS
the sale of available-for-sale securities, net of tax
Reclassification adjustment for OTTI charges realized in net income
Reclassification adjustment for losses realized in net income due to
Other comprehensive (loss) income:
Accumulated
Shares Deferred Other
Outstanding Common Contributed Retained Treasury Compensation Comprehensive Stockholders’
(1) Stock Capital Earnings Stock (2) Expense Income (loss) Equity
221,897 $ 2,416 $ 369,807 $ 978,855 $ (216,513) $ (1,041) $ 22,028 $ 1,155,552
4,556 45 83,615 – – 1,041 – 84,701
– – – – – (314) (314)
– – – (61,521) – – – (61,521)
221,284 2,461 453,418 1,302,345 (362,626) – 21,714 1,417,312
– – – (13,304) – (13,304)
221,284 2,461 453,418 1,289,041 (362,626) – 21,714 1,404,008
1,092 20 39,977 – – – – 39,997
(18,750) – – – (438,291) – – (438,291)
(415) – – – (12,310) – – (12,310)
1,269 – – (6,480) 20,546 – – 14,066
Net income
Repurchase of common stock from employees
of publicly announced programs
Other comprehensive income, net of tax
– – – (80,796) – – – (80,796)
204,480 2,481 493,395 1,601,784 (792,681) – 35,485 1,340,464
453 4 20,179 420 – – – 20,603
(164) – – – (3,432) – – (3,432)
512 – – (4,710) 9,313 – – 4,603
– – – 179,061 – – – 179,061
– – – – – – (49,874) (49,874)
– – – (82,394) – – – (82,394)
$ 205,281 $ 2,485 $ 513,574 $ 1,694,161 $ (786,800) $ – $ (14,389) $ 1,409,031
Note 1
Repurchase of common stock from employees
Stock awards
Reissuance of treasury stock
600,000 authorized, 249,328 issued and 205,281 outstanding (excluding 799 shares of non-vested restricted stock), $0.01 par value common stock at January 31,
Balance at January 31, 2009
Cash dividends ($0.40 per share)
Other comprehensive loss, net of tax
Net income
Balance at February 2, 2008
Cash dividends ($0.98 per share)
Stock awards
Other comprehensive loss, net of tax
Repurchase of common stock as part
Stock awards
Adoption of FIN 48
Balance at February 3, 2007
Balance at February 4, 2007
AMERICAN EAGLE OUTFITTERS, INC.
Cash dividends ($0.28 per share)
Balance at January 31, 2006
(in thousands, except per share amounts)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(5,250) – – (146,485) – – (146,485)
(4) – (113) – – – – (113)
528 – 109 (2,348) 8,007 – – 5,768
announced programs
Repurchase of common stock as part of publicly
Net income
stock split
Cash paid for fractional shares in three-for-two
Reissuance of treasury stock
January 31, February 2, February 3,
(In thousands) 2009 2008 2007
Operating activities:
Net income
$ 179,061 $ 400,019 $ 387,359
Adjustments to reconcile income to net cash provided by operating activities:
Merchandise inventory
(13,735) (19,074) (53,527)
Accounts and note receivable
(10,094) (5,660) 7,448
Prepaid expenses and other
(24,781) (1,334) (4,204)
Other assets, net
390 (3,242) (5,357)
Accounts payable
(3,053) (15,559) 32,345
(11,392) (699) 11,623
18,887 4,640 7,791
(20,697) (31,416) 43,482
(19,188) (2,598) 33,047
123,132 64,251 361,909
(265,335) (250,407) (225,939)
– – 12,345
(48,655) (1,772,653) (1,353,339)
Sale of available-for-sale securities
393,559 2,126,891 915,952
AMERICAN EAGLE OUTFITTERS, INC.
For the Years Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS
133,141 110,753 89,698
20,296 33,670 36,556
24,469 (8,147) (27,572)
1,121 7,260 25,465
(693) (6,156) (19,541)
(1,141) 1,221 687
6,713 592 –
22,889 – –
– – 183,968
Other investing activities
(1,180) (1,170) (140)
Net cash provided by (used for) investing activities
78,389 102,661 (651,121)
Financing activities:
Payments on note payable and capital leases
(2,177) (1,912) (3,020)
Cash and cash equivalents – beginning of period
116,061 59,737 130,529
Cash and cash equivalents – end of period
$ 473,342 $ 116,061 $ 59,737
75,000 – 2,025
– (438,291) (146,485)
(3,432) (12,310) (7,635)
– – (113)
3,799 13,183 28,447
693 6,156 19,541
(82,394) (80,796) (61,521)
(8,511) (513,970) (168,761)
(14,790) 3,363 (178)
357,281 56,324 (70,792)
2009 2008
$ 316,035 $ 49,912
49,948 141,883
Total current assets 624,402 385,183
Accrued compensation
Accrued expenses and other current liabilities
Deferred rent and other liabilities
Current Liabilities:
Accounts payable
Deferred income taxes and other assets
Retained earnings
Additional paid-in capital
505,407 299,291
155,226 64,748
none issued – –
Commitments and contingencies (see Note 11)
Shareholders’ equity:
Marketable securities
Preferred shares; $.0001 par value, 10,000,000 shares authorized,
Common shares; $.0001 par value, 200,000,000 shares authorized,
Property and equipment, net
Marketable securities
(in thousands, except share and per share data)
Consolidated Balance Sheets
URBAN OUTFITTERS, INC.
Current Assets:
Cash and cash equivalents
January 31,
ASSETS
Accounts receivable, net of allowance for doubtful accounts of $1,229
Prepaid expenses and other current assets
Deferred taxes
2009 2008 2007
Net sales 1,834,618$ 1,507,724$ 1,224,717$
Cost of sales, including certain buying, distribution
and occupancy costs 1,121,140 930,952 772,796
Gross profit 713,478 576,772 451,921
Basic 1.20$ 0.97$ 0.71$
Diluted 1.17$ 0.94$ 0.69$
Weighted average common shares outstanding:
Basic 166,793,062 165,305,207 164,679,786
Diluted 170,860,605 169,640,585 168,652,005
Consolidated Statements of Income
URBAN OUTFITTERS, INC.
Fiscal Year Ended January 31,
(in thousands, except share and per share data)
Selling, general and administrative expenses 414,043 351,827 287,932
Income from operations 299,435 224,945 163,989
Interest income 11,504 9,390 6,531
Other income 694 575 353
Other expenses (2,143) (515) (715)
Income before income tax expense 309,490 234,395 170,158
Income tax expense 110,126 74,164 53,952
Net income per common share:
Accumulated
Additional Other
Comprehensive Number of Par Paid-in Unearned Retained Comprehensive
Income Shares Value Capital Compensation Earnings Income (loss) Total
Balances as of February 1, 2006 164,831,477 16$ 138,050$ (3,905)$ 426,190$ 528$ 560,880$
Net Income 116,206$ – – – – 116,206 – 116,206
Foreign currency translation 3,614 – – – – – 3,614 3,614
Unrealized losses on marketable securities,
net of tax 142 – – – – – 142 142
Comprehensive income 119,962$
Share-based compensation – – 3,497 – – 3,497
Unearned compensation reclass – – (3,905) 3,905 – – –
Share-based compensation – – 3,277 – – – 3,277
Exercise of stock options 1,117,152 – 5,000 – – – 5,000
Tax effect of share exercises – – 7,341 – – – 7,341
Balances as of January 31, 2008 166,104,615 17 144,204 – 701,975 7,235 853,431
Net income 199,364 – – – – 199,364 – 199,364
Foreign currency translation (19,866) – – – – – (19,866) (19,866)
Unrealized losses on marketable securities,
net of tax (5,116) – – – – – (5,116) (5,116)
Comprehensive income 174,382$
Share-based compensation – – 3,637 – – – 3,637
Exercise of stock options 1,607,473 – 8,891 – – – 8,891
Tax effect of share exercises – – 13,434 – – – 13,434
Balances as of January 31, 2009 167,712,088 17$ 170,166$ –$ 901,339$ (17,747)$ 1,053,775$
Consolidated Statements of Shareholders’ Equity
URBAN OUTFITTERS, INC.
(in thousands, except share data)
Common Shares
Exercise of stock options 1,375,986 1 6,350 – – – 6,351
Tax effect of share exercises – 5,394 5,394
Share Repurchase (1,220,000) – (20,801) – – – (20,801)
Balances as of January 31, 2007 164,987,463 17 128,586 – 542,396 4,284 675,283
Net income 160,231 – – – – 160,231 – 160,231
Foreign currency translation 703 – – – – – 703 703
FIN48 adjustment – (652) (652)
Unrealized gains on marketable securities,
net of tax 2,248 – – – – – 2,248 2,248
Comprehensive income 163,182$
2009 2008 2007
Cash flows from operating activities:
Net income 199,364$ 160,231$ 116,206$
Accounts payable, accrued expenses and other liabilities (8,868) 75,967 33,600
Net cash provided by operating activities 251,570 254,353 187,117
Cash flows from investing activities:
Cash flows from financing activities:
Exercise of stock options 8,891 5,000 6,351
Excess tax benefit of stock options exercises 13,434 7,341 5,394
Share repurchases – – (20,801)
Net cash provided by (used in) financing activities 22,325 12,341 (9,056)
Effect of exchange rate changes on cash and cash equivalents (6,224) 212 702
Increase (decrease) in cash and cash equivalents 210,764 78,004 (22,645)
Cash and cash equivalents at beginning of period 105,271 27,267 49,912
Cash and cash equivalents at end of period 316,035$ 105,271$ 27,267$
Supplemental cash flow information:
Cash paid during the year for:
Income taxes 115,040$ 70,765$ 52,535$
Non-cash investing activities – Accrued capital expenditures 6,561$ 6,645$ 14,618$
Cash paid for property and equipment (112,553) (115,370) (212,029)
Cash paid for marketable securities (809,039) (293,633) (182,653)
(in thousands)
Consolidated Statements of Cash Flows
URBAN OUTFITTERS, INC.
Fiscal Year Ended January 31,
Adjustments to reconcile net income to net cash provided by operating activities: