Go to http://lowes.com to locate financial information for Lowe’s Companies. You can follow the link at the bottom of the page to “Investor Relations,” to “Investor Documents,” to “SEC Filings” and finally to the most recent 10-K. Answer the following questions about the company:

1. Examine Lowe’s income statement. What does the company call this statement? Does it use the single-step or multiple-step format? What subtitles does Lowe’s use in its income statement?

What was Lowe’s net income in the most recent year? Was this more or less income than the company had in the preceding year?

2. Now look at Lowe’s balance sheet. What is the company’s largest current asset? What is its largest current liability? What is the balance in its property account? What was the original cost of the property and the accumulated depreciation? (See the notes to the financial statements.)

3. What is the largest component of Lowe’s stockholders’ equity? What proportion of total stock-holders’ equity does it represent? What does this imply about Lowe’s profitability in the past?

4. Examine Lowe’s statement of cash flows. Is the company’s cash flow from operating activities more or less than its net earnings? Why? Did cash increase or decrease during the year? By how much?

5. Compare Lowe’s depreciation and amortization to its cash used for acquiring fixed assets. Which is larger? What does this tell you?