Question: Barnes Noble Inc revolutionized bookselling by making its stores

Barnes & Noble Inc. revolutionized bookselling by making its stores public spaces and community institutions where customers may browse, find a book, relax over a cup of coffee, talk with authors, and join discussion groups. Today it is fighting increasing competition not only from traditional sources but also from online booksellers. Presented here is a recent statement of earnings (in millions of dollars):
Assume that the following hypothetical additional transactions occurred during the fiscal year:
(a) Recorded and received interest income of $ 14
(b) Purchased $ 95 of additional inventory on open account
(c) Recorded and paid additional advertising expense of $ 19
(d) Issued additional common shares for $ 90 cash.
Complete the following tabulation, indicating the sign of the effect of each additional transaction (+ for increase, – for decrease, and NE for no effect). Assume that the company’s return on assets is less than one prior to these transactions. Consider each item independently and ignore income taxes.

  • CreatedAugust 04, 2015
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