Question: Refer to the financial statements of The Home Depot in

Refer to the financial statements of The Home Depot in Appendix A at the end of this book, or download the annual report from the Cases section in the Connect library.
1. How much inventory does the company hold on February 2, 2014? Does this represent an increase or decrease in comparison to the prior year?
a. $ 10,710, which is a decrease
b. $ 10,710, which is an increase
c. $ 11,057, which is a decrease
d. $ 11,057, which is an increase
2. What method(s) does the company use to determine the cost of its inventory? Describe where you found this information.
a. LIFO; Note 1
b. FIFO; Note 1
c. Weighted average cost; the Balance Sheet
d. Specific Identification; Management’s Discussion and Analysis
3. Compute to one decimal place the company’s inventory turnover ratio and days to sell for the year ended February 2, 2014.
a. 4.7 and 77.7
b. 4.8 and 76.0
c. 7.1 and 51.4
d. 7.2 and 50.7
4. Does the company believe FIFO, or weighted average cost, is a better method?
b. Weighted average cost

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