(Selecting a benchmark company) Here you will find the income statements and balance sheets for Sears...

Transcribed Image Text:

(Selecting a benchmark company) Here you will find the income statements and balance sheets for Sears Holdings (SHLD) and Target Corp (TGT). Assume that you are a financial manager at Sears and want to compare your firm's situation with that of Target. Calculate representative ratios for liquidity, asset management efficiency, financial leverage (capital structure), and profitability for both Sears and Target. How would you summarize the financial performance of Sears compared to Target (its benchmark firm)? 1. Liquidity Ratios Sears' current ratio is times. (Round to two decimal places.) Data table Period Ended Total revenue Cost of revenue Gross profit Operating expenses Operating income or loss Interest expense Net income Sears Holdings (SHLD) 31-Jan-09 Target Corp (TGT) 31-Jan-09 $46,770,000 $64,948,000 (34,118,000) (44,157,000) $12,652,000 $20,791,000 (12,050,000) (16,389,000) $602,000 $4,402,000 (272,000) (894,000) $330,000 $3,508,000 (Click on the icon in order to copy its contents into a spreadsheet.) Sears Holdings (SHLD) Target Corp PERIOD ENDING Cash and cash equivalents Accounts receivable Inventories 31-Jan-09 $864,000 (TGT) 31-Jan-09 $1,297,000 9,446,000 866,000 6,705,000 8,795,000 Other current assets. 473,000 Total current assets $17,488,000 458,000 $11,416,000 Long-term investments 163,000 0 Property, plant, and equipment 25,756,000 8,091,000 Other assets 699,000 5,835,000 Total assets $44,106,000 $25,342,000 Liabilities Accounts payable $7,366,000 $3,430,000 Short-/current long-term debt 1,262,000 Other current liabilities 1,884,000 787,000 4,295,000 Total current liabilities $10,512,000 $8,512,000 Long-term debt. Other long-term liabilities 17,490,000 2,132,000 2,392,000 5,318,000 Total long-term liabilities. Total stockholders' equity Total liabilities and owners' equity $19,882,000 $7,450,000 13,712,000 9,380,000 $44,106,000 $25,342,000 (Click on the icon in order to copy its contents into a spreadsheet.) Print Done C (Selecting a benchmark company) Here you will find the income statements and balance sheets for Sears Holdings (SHLD) and Target Corp (TGT). Assume that you are a financial manager at Sears and want to compare your firm's situation with that of Target. Calculate representative ratios for liquidity, asset management efficiency, financial leverage (capital structure), and profitability for both Sears and Target. How would you summarize the financial performance of Sears compared to Target (its benchmark firm)? 1. Liquidity Ratios Sears' current ratio is times. (Round to two decimal places.) Data table Period Ended Total revenue Cost of revenue Gross profit Operating expenses Operating income or loss Interest expense Net income Sears Holdings (SHLD) 31-Jan-09 Target Corp (TGT) 31-Jan-09 $46,770,000 $64,948,000 (34,118,000) (44,157,000) $12,652,000 $20,791,000 (12,050,000) (16,389,000) $602,000 $4,402,000 (272,000) (894,000) $330,000 $3,508,000 (Click on the icon in order to copy its contents into a spreadsheet.) Sears Holdings (SHLD) Target Corp PERIOD ENDING Cash and cash equivalents Accounts receivable Inventories 31-Jan-09 $864,000 (TGT) 31-Jan-09 $1,297,000 9,446,000 866,000 6,705,000 8,795,000 Other current assets. 473,000 Total current assets $17,488,000 458,000 $11,416,000 Long-term investments 163,000 0 Property, plant, and equipment 25,756,000 8,091,000 Other assets 699,000 5,835,000 Total assets $44,106,000 $25,342,000 Liabilities Accounts payable $7,366,000 $3,430,000 Short-/current long-term debt 1,262,000 Other current liabilities 1,884,000 787,000 4,295,000 Total current liabilities $10,512,000 $8,512,000 Long-term debt. Other long-term liabilities 17,490,000 2,132,000 2,392,000 5,318,000 Total long-term liabilities. Total stockholders' equity Total liabilities and owners' equity $19,882,000 $7,450,000 13,712,000 9,380,000 $44,106,000 $25,342,000 (Click on the icon in order to copy its contents into a spreadsheet.) Print Done C