Analyzing, Forecasting, and Interpreting Income Statement and Balance Sheet Foll
ID: 2755228 • Letter: A
Question
Analyzing, Forecasting, and Interpreting Income Statement and Balance Sheet
Following are the income statement and balance sheet of Whole Foods Market, Inc.
Forecast Whole Foods Market's 2011 income statement using the following relations (assume "no change" for accounts not listed). ($ 000s)
Instructions: Round all answers to the nearest whole number. Do notuse negative signs with your answers. Remember to use roundedforecasted sales with subsequent calculations.
Forecast Whole Foods Market's 2011 balance sheet using the following relations (assume "no change" for accounts not listed). ($ 000s)
Instructions: Round answers to the nearest whole number. Do notuse negative signs with your answers. Remember to use roundedforecasted sales with subsequent calculations.
Income Statement,For Years Ended (in $ 000s) 2010 2009 Sales $ 9,005,794 $ 8,031,620 Cost of goods sold and occupancy costs 5,870,393 5,277,310 Gross profit 3,135,401 2,754,310 Direct store expenses 2,375,716 2,145,809 General administrative expenses 272,449 243,749 Pre-opening expenses 38,044 49,218 Relocation, store closures and lease termination costs 11,217 31,185 Operating income 437,975 284,349 Interest expense (33,048) (36,856) Investment and other income 6,854 3,449 Income before income taxes 411,781 250,942 Provision for income taxes 165,948 104,138 Net income $ 245,833 $ 146,804
Explanation / Answer
Income Statement For Years Ended (in $ 000s) 2011 Sales 97,26,258 (1.08*9005794, as 8% growth) Cost of goods sold and occupancy costs 63,41,520 (65.2% of sales) Gross profit 33,84,738 Direct store expenses 25,67,732 (26.4% of sales) General administrative expenses 2,91,788 (3% of sales) Pre-opening expenses 38,905 (0.4% of sales) Relocation, store closures and lease termination costs - (as per chart) Operating income 4,86,313 Interest expense -33,048 (as per chart) Investment and other income 6,854 (as per chart) Income before income taxes 4,60,119 Provision for income taxes 1,85,428 (40.3% of pretax income) Net income 2,74,691 Balance Sheet, ($ 000s) 2011 Assets Cash and cash equivalents 1,45,894 (1.5% of sales) Short-term investments-available-for-sale securities 3,29,738 (no change as nothing listed) Restricted cash 86,802 (as per chart) Accounts receivable 1,45,894 (1.5% of sales) Merchandise inventories 3,50,145 (3.6% of sales) Prepaid expenses and other current assets 58,358 (0.6% of sales) Deferred income taxes 1,01,464 (as per chart) Total current assets 12,18,295 (sum of above) Property and equipment, net of accum depr and amortization 18,67,269 (1886130 + 14.5% of 1886130 - 13.5% of 1886130) Long-term investments--available-for-sale securities 96,146 (as per chart) Goodwill 6,65,224 (as per chart) Intangible assets, net of accumulated amortization 69,064 (as per chart) Deferred income taxes 99,156 (as per chart) Other assets 9,726 (0.1% of sales) Total assets 40,24,879 (sum of above) Liabilities and shareholders' equity Current installments of long-term debt and capital lease obligations 410 (as per chart) Accounts payable 2,33,430 (2.4% of sales) Accrued payroll, bonus and other benefits due team members 2,62,609 (2.7% of sales) Dividends payable 9,614 (3.5% of net income) Other current liabilities 3,11,240 (3.2% of sales) Total current liabilities 8,17,304 (sum of above) Long-term debt and capital lease obligations, less current installments 5,08,288 (no change as nothing listed) Deferred lease liabilities 2,94,291 (as per chart) Other long-term liabilities 68,084 (0.7% of sales) Total liabilities 16,87,966 (sum of above) Series A redeemable preferred stock; $0.01 par value - (as per chart) Shareholders' equity: Common stock, no par value 17,73,897 (as per chart) Accumulated other comprehensive income (loss) 791 (as per chart) Retained earnings 5,62,225 (balancing figure) Total shareholders' equity 23,36,913 (sum of above) Total liabilities and shareholders' equity 40,24,879 (sum of total liability and total equity)