Report for CEO (Wal-Mart) At the most recent strategic planning meeting, the boa
ID: 2742466 • Letter: R
Question
Report for CEO (Wal-Mart)
At the most recent strategic planning meeting, the board of directors of your company has voted to issue additional stock to raise capital for major expansions for the company in the next five years. The board is considering $5 million. Take the most recent financial statements and prepare a set of projected financial statements based on the given assumptions. The CEO requests that you prepare a written report (including the financial statements) for her.
A. Generate a projected income statement based on the given scenario.
B. Analyze the impact on the income statement based on the given scenario.
C. Generate a projected statement of retained earnings based on the given scenario.
D. Analyze the impact on the statement of retained earnings based on the given scenario.
E. Generate a projected balance sheet based on the given scenario.
F. Analyze the impact on the balance sheet based on the given scenario.
G. Generate a projected cash flow statement based on the given scenario.
H. Analyze the impact on the cash flow statement based on the given scenario.
Wal-Mart Stores Inc., Consolidated Income Statement
USD $ in millions
12 months ended
Jan 31, 2016
Jan 31, 2015
Jan 31, 2014
Jan 31, 2013
Jan 31, 2012
Jan 31, 2011
Net sales
478,614
482,229
473,076
466,114
443,854
418,952
Cost of sales
(360,984)
(365,086)
(358,069)
(352,488)
(335,127)
(315,287)
Gross profit
117,630
117,143
115,007
113,626
108,727
103,665
Membership and other income
3,516
3,422
3,218
3,048
3,096
2,897
Operating, selling, general and administrative expenses
(97,041)
(93,418)
(91,353)
(88,873)
(85,265)
(81,020)
Operating income
24,105
27,147
26,872
27,801
26,558
25,542
Interest expense, debt, capital lease and financing obligations
(2,548)
(2,461)
(2,335)
(2,251)
(2,322)
(2,205)
Interest income
81
113
119
187
162
201
Interest, net
(2,467)
(2,348)
(2,216)
(2,064)
(2,160)
(2,004)
Income from continuing operations before income taxes
21,638
24,799
24,656
25,737
24,398
23,538
Provision for income taxes
(6,558)
(7,985)
(8,105)
(7,981)
(7,944)
(7,579)
Income from continuing operations
15,080
16,814
16,551
17,756
16,454
15,959
Income (loss) from discontinued operations, net of income taxes
–
285
144
–
(67)
1,034
Consolidated net income
15,080
17,099
16,695
17,756
16,387
16,993
Consolidated net income attributable to noncontrolling interest
(386)
(736)
(673)
(757)
(688)
(604)
Consolidated net income attributable to Walmart
14,694
16,363
16,022
16,999
Balance Sheet
All numbers in thousands
Period Ending
1/31/2016
1/31/2015
1/31/2014
Current Assets
Cash And Cash Equivalents
8,705,000
9,135,000
7,281,000
Short Term Investments
-
-
-
Net Receivables
5,624,000
6,778,000
6,677,000
Inventory
44,469,000
45,141,000
44,858,000
Other Current Assets
1,441,000
2,224,000
2,369,000
Total Current Assets
60,239,000
63,278,000
61,185,000
Long Term Investments
-
-
-
Property Plant and Equipment
116,516,000
116,655,000
117,907,000
Goodwill
16,695,000
18,102,000
19,510,000
Intangible Assets
-
-
-
Accumulated Amortization
-
-
-
Other Assets
6,131,000
5,455,000
6,149,000
Deferred Long Term Asset Charges
-
-
-
Total Assets
199,581,000
203,490,000
204,751,000
Current Liabilities
Accounts Payable
58,615,000
58,583,000
57,174,000
Short/Current Long Term Debt
6,004,000
6,670,000
12,082,000
Other Current Liabilities
-
-
89,000
Total Current Liabilities
64,619,000
65,253,000
69,345,000
Long Term Debt
44,030,000
43,495,000
44,559,000
Other Liabilities
-
-
-
Deferred Long Term Liability Charges
7,321,000
8,805,000
8,017,000
Minority Interest
3,065,000
4,543,000
5,084,000
Negative Goodwill
-
-
-
Total Liabilities
119,035,000
122,096,000
127,005,000
Stockholders' Equity
Misc. Stocks Options Warrants
-
-
1,491,000
Redeemable Preferred Stock
-
-
-
Preferred Stock
-
-
-
Common Stock
317,000
323,000
323,000
Retained Earnings
90,021,000
85,777,000
76,566,000
Treasury Stock
-
-
-
Capital Surplus
1,805,000
2,462,000
2,362,000
Other Stockholder Equity
-11,597,000
-7,168,000
-2,996,000
Total Stockholder Equity
80,546,000
81,394,000
76,255,000
Net Tangible Assets
63,851,000
63,292,000
56,745,000
Cash Flow
All numbers in thousands
Period Ending
1/31/2016
1/31/2015
1/31/2014
Net Income
14,694,000
16,363,000
16,022,000
Operating Activities, Cash Flows Provided By or Used In
Depreciation
9,454,000
9,173,000
8,870,000
Adjustments To Net Income
738,000
-3,000
515,000
Changes In Accounts Receivables
-19,000
-569,000
-566,000
Changes In Liabilities
2,839,000
4,093,000
-590,000
Changes In Inventories
-703,000
-1,229,000
-1,667,000
Changes In Other Operating Activities
-
-
-
Total Cash Flow From Operating Activities
27,389,000
28,564,000
23,257,000
Investing Activities, Cash Flows Provided By or Used In
Capital Expenditures
-11,477,000
-12,174,000
-13,115,000
Investments
-
-
-
Other Cash flows from Investing Activities
802,000
1,049,000
589,000
Total Cash Flows From Investing Activities
-10,675,000
-11,125,000
-12,526,000
Financing Activities, Cash Flows Provided By or Used In
Dividends Paid
-7,013,000
-6,785,000
-6,565,000
Sale Purchase of Stock
-5,438,000
-2,859,000
-6,979,000
Net Borrowings
-3,158,000
-5,018,000
3,015,000
Other Cash Flows from Financing Activities
-513,000
-409,000
-260,000
Total Cash Flows From Financing Activities
-16,122,000
-15,071,000
-10,789,000
Effect Of Exchange Rate Changes
-1,022,000
-514,000
-442,000
Change In Cash and Cash Equivalents
-430,000
1,854,000
-500,000
12 months ended
Jan 31, 2016
Jan 31, 2015
Jan 31, 2014
Jan 31, 2013
Jan 31, 2012
Jan 31, 2011
Net sales
478,614
482,229
473,076
466,114
443,854
418,952
Cost of sales
(360,984)
(365,086)
(358,069)
(352,488)
(335,127)
(315,287)
Gross profit
117,630
117,143
115,007
113,626
108,727
103,665
Membership and other income
3,516
3,422
3,218
3,048
3,096
2,897
Operating, selling, general and administrative expenses
(97,041)
(93,418)
(91,353)
(88,873)
(85,265)
(81,020)
Operating income
24,105
27,147
26,872
27,801
26,558
25,542
Interest expense, debt, capital lease and financing obligations
(2,548)
(2,461)
(2,335)
(2,251)
(2,322)
(2,205)
Interest income
81
113
119
187
162
201
Interest, net
(2,467)
(2,348)
(2,216)
(2,064)
(2,160)
(2,004)
Income from continuing operations before income taxes
21,638
24,799
24,656
25,737
24,398
23,538
Provision for income taxes
(6,558)
(7,985)
(8,105)
(7,981)
(7,944)
(7,579)
Income from continuing operations
15,080
16,814
16,551
17,756
16,454
15,959
Income (loss) from discontinued operations, net of income taxes
–
285
144
–
(67)
1,034
Consolidated net income
15,080
17,099
16,695
17,756
16,387
16,993
Consolidated net income attributable to noncontrolling interest
(386)
(736)
(673)
(757)
(688)
(604)
Consolidated net income attributable to Walmart
14,694
16,363
16,022
16,999
Explanation / Answer
A.)
After the scenario
B. No change in income statement as no item is affected in the income statement as no item is affected by issue of equity shares.
C.)
D.) Share holder's in which common stock will rise as given as money is raised by the company in the form of equity shares.
12 months ended 31-Jan-16 31-Jan-15 31-Jan-14 31-Jan-13 31-Jan-12 31-Jan-11 Net sales 478614.00 482229 473076 466114 443854 418952 Cost of sales -360,984 -365,086 -358,069 -352,488 -335,127 -315,287 Gross profit 117,630 117,143 115,007 113,626 108,727 103,665 Membership and other income 3516.00 3422.00 3218.00 3048.00 3096.00 2897.00 Operating, selling, general and administrative expenses -97,041 -93,418 -91,353 -88,873 -85,265 -81,020 Operating income 24105 27147 26872 27801 26558 25542 Interest expense, debt, capital lease and financing obligations -2,548 -2,461 -2,335 -2,251 -2,322 -2,205 Interest income 81 113 119 187 162 201 Interest, net -2,467 -2,348 -2,216 -2,064 -2,160 -2,004 Income from continuing operations before income taxes 21,638 24,799 24,656 25,737 24,398 23,538 Provision for income taxes -6,558 -7,985 -8,105 -7,981 -7,944 -7,579 Income from continuing operations 15,080 16,814 16,551 17,756 16,454 15,959 Income (loss) from discontinued operations, net of income taxes – 285 144 0 -67 1034 Consolidated net income 15,080 17,099 16,695 17,756 16,387 16,993 Consolidated net income attributable to noncontrolling interest -386 -736 -673 -757 -688 -604 Consolidated net income attributable to Walmart 14,694 16,363 16,022 16,999