AutoZone Inc. reports the following income statements. Consolidated Statement of Income ($ in Thousands) 12 Months Ended Aug. 27, 2016 Net sales $10,635,676 Cost of sales, including warehouse and delivery expenses 5,026,940 Gross profit 5,608,736 Operating, selling, general and administrative expenses 3,548,341 Operating profit 2,060,395 Interest expense, net 147,681 Income before income taxes 1,912,714 Income tax expense 671,707 Net income $1,241,007 Forecast AutoZone's 2017 income statement assuming the following income statement relations ($ in thousands). All percentages, (other than sales growth and provision for income taxes) are based on percent of net sales. Net sales growth 6% Cost of sales, including warehouse and delivery expenses 47.3% Operating, selling, general and administrative expenses 33.4% Interest expense, net $145,000 Income tax expense (% pretax income) 35% Round your answers to the nearest whole number. Do not use negative signs with your answers. Forecasted Income Statement ($ thousands) 2016 2017 Est. Net sales $10,635,676 Answer Cost of goods sold 5,026,940 Answer Gross profit 5,608,736 Answer Operating, selling, general, and admin expenses 3,548,341 Answer Operating profit 2,060,395 Answer Interest expense, net 147,681 Answer Income before income taxes 1,912,714 Answer Income tax expense 671,707 Answer Incorrect Mark 0.00 out of 1.00 Net income $ 1,241,007 Answe
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
AutoZone Inc. reports the following income statements.
| Consolidated Statement of Income ($ in Thousands) | 12 Months Ended Aug. 27, 2016 |
|
|---|---|---|
| Net sales | $10,635,676 | |
| Cost of sales, including warehouse and delivery expenses | 5,026,940 | |
| Gross profit | 5,608,736 | |
| Operating, selling, general and administrative expenses | 3,548,341 | |
| Operating profit | 2,060,395 | |
| Interest expense, net | 147,681 | |
| Income before income taxes | 1,912,714 | |
| Income tax expense | 671,707 | |
| Net income | $1,241,007 |
| Net sales growth | 6% |
| Cost of sales, including warehouse and delivery expenses | 47.3% |
| Operating, selling, general and administrative expenses | 33.4% |
| Interest expense, net | $145,000 |
| Income tax expense (% pretax income) | 35% |
Round your answers to the nearest whole number.
Do not use negative signs with your answers.
| ($ thousands) | 2016 | 2017 Est. |
|---|---|---|
| Net sales | $10,635,676 | Answer
|
| Cost of goods sold | 5,026,940 | Answer
|
| Gross profit | 5,608,736 | Answer
|
| Operating, selling, general, and admin expenses | 3,548,341 | Answer
|
| Operating profit | 2,060,395 | Answer
|
| Interest expense, net | 147,681 | Answer
|
| Income before income taxes | 1,912,714 | Answer
|
| Income tax expense | 671,707 | Answer
Incorrect
Mark 0.00 out of 1.00 |
| Net income | $ 1,241,007 | Answer
|
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