Obtain CarMax, Inc.’s Form 10-K for the fiscal year ending on February 29, 2012. To obtain the Form 10-K, you can use the EDGAR system (see Appendix A at the back of this text for instructions), or it can be found under the “Investor Relations” link on the company’s website at www.carmax.com. Read the following sections of the 10-K: “Used Car Superstores as of February 29, 2012” on page 14, “Expansion” on page 15, “Fiscal 2013 Planned Superstore Openings” on page 32, and the Consolidated Statements of Cash Flows on page 41.

Required
a. How many superstores did CarMax plan to open during its 2013 fiscal year? By what percentage would these new stores increase the size of CarMax’s superstore operations?
How much did CarMax estimate these expansions will cost?
b. How much cash did CarMax spend on capital expenditures during its 2010, 2011, and 2012 fiscal years? Do you think the amount spent on “capital expenditures” represents the full costs that CarMax incurred to open new stores? Explain your answer.
c. Where did CarMax get the cash used to make these investments?