Macy’s Inc. is the parent company of Macy’s and Blooming dale’s department stores. Use Macy’s annual report with a year-end of February2, 2008, to answer the following questions. The annual report can be found at www.macys.com; follow the links to investor relations.
(a) What is Macy’s cost of sales?
(b) What is the average balance in inventory for the year?
(c) Calculate the inventory turnover ratio and the age of inventory. Comment on the results.
(d) What is the main method of cost ﬂow valuation used by Macy’s?
(e) Does the company write its inventory down to lower-of-cost-or-market?
(f) From February 2007 to February 2008, what was the percent increase or decrease in
(1) Net sales.
(2) Cost of sales.
(3) Ending inventory? Comment on the relationship among these percentages.