Question

NEED IT FOR TOMORROW MIDNIGHT SUNDAY THE 8th PLEASE

1. Calculate RNOA and decompose into net operating profit margin and operating asset turnover (Module 4).
2. Describe inventory valuation and depreciation methods for the two companies and compare methods between the two companies (Module 6). Are there any substantial differences that should be adjusted for when comparing performance for the two companies?

Balance Sheet For company A:

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Feb. 03, 2018	Jan. 28, 2017
Current assets:
Cash and cash equivalents	$ 1,308	$ 1,074
Merchandise inventories	3,542	3,795
Other	481	378
Total current assets	5,331	5,247
Property and equipment, net	7,773	8,103
Other assets	236	224
Total assets	13,340	13,574
Current liabilities:
Accounts payable	1,271	1,507
Accrued liabilities	1,155	1,224
Income taxes payable	99	112
Current portion of capital lease and financing obligations	126	131
Total current liabilities	2,651	2,974
Long-term debt	2,797	2,795
Capital lease and financing obligations	1,591	1,685
Deferred income taxes	213	272
Other long-term liabilities	662	671
Shareholders’ equity:
Common stock - 373 and 371 million shares issued	4	4
Paid-in capital	3,078	3,003
Treasury stock, at cost, 205 and 197 million shares	(10,651)	(10,338)
Accumulated other comprehensive loss	(11)	(14)
Retained earnings	13,006	12,522
Total shareholders’ equity	5,426	5,177
Total liabilities and shareholders’ equity	$ 13,340	$ 13,574

Balance Sheet Company C:

Consolidated Statements of Financial Position - USD ($) $ in Millions	Feb. 03, 2018	Jan. 28, 2017
Assets
Cash and cash equivalents	$ 2,643	$ 2,512
Inventory	8,657	8,309
Other current assets	1,264	1,169
Total current assets	12,564	11,990
Property and equipment
Land	6,095	6,106
Buildings and improvements	28,396	27,611
Fixtures and equipment	5,623	5,503
Computer hardware and software	2,645	2,651
Construction-in-progress	440	200
Accumulated depreciation	(18,181)	(17,413)
Property and equipment, net	25,018	24,658
Other noncurrent assets	1,417	783
Total assets	38,999	37,431
Liabilities and shareholders' investment
Accounts payable	8,677	7,252
Accrued and other current liabilities	4,254	3,737
Current portion of long-term debt and other borrowings	270	1,718
Total current liabilities	13,201	12,707
Long-term debt and other borrowings	11,317	11,031
Deferred income taxes	713	861
Other noncurrent liabilities	2,059	1,879
Total noncurrent liabilities	14,089	13,771
Shareholders' investment
Common stock	45	46
Additional paid-in capital	5,858	5,661
Retained earnings	6,553	5,884
Accumulated other comprehensive loss	(747)	(638)
Total shareholders' investment	11,709	10,953
Total liabilities and shareholders' investment	$ 38,999	$ 37,431

Answer 1

Answer Part-1

RNOA= NET INCOME/ (Fixed Assets+Working Capital)

Working Capital=Current Assets-Current Liabilities

Given,

Company A (Amount in Million $)

Description	Feb 03, 2018	Jan 28,2017
Net Income as per Books	13006	12242
Fixed Assets (Net)	7773	8103
Add: Working Capital
(Current Assets-Current Liabilities)	2680	2273
Total Assets	10453	10376
Hence, RNOA	1.24	1.18

Company C (Amount in Million $)

Description	Feb 03, 2018	Jan 28,2017
Net Income as per Books	6553	5884
Fixed Assets (Net)	25018	24658
Add: Working Capital
(Current Assets-Current Liabilities)	-637	-717
Total Assets	24381	23941
Hence, RNOA	0.27	0.25

Net Operating Profit Margin

= Operating Profit/Total Sales(Revenue)

Operating Profit=Revenue -COGS-Operating Expenses-Interest Expenses-Taxes