Following is the income statement for Nordstrom Company. Assume that the combined federal and state statutory tax rate is 37%. ($ millions) 2016 Net sales $14,095 Credit card revenues 342 Total revenues 14,437 Cost of sales and related buying and occupancy costs (9,168) Selling, general and administrative expenses (4,168) Earnings before interest and income taxes 1,101 Interest expense, net (125) Earnings before income taxes 976 Income tax expense (376) Net earnings $ 600 Compute NOPAT for Nordstrom for 2016. (Hint: Treat credit card revenues as operating.) a. $ 679 million b. $1,136 million c. $ 851 million d. $ 725 million
Following is the income statement for Nordstrom Company. Assume that the combined federal and state statutory tax rate is 37%. ($ millions) 2016 Net sales $14,095 Credit card revenues 342 Total revenues 14,437 Cost of sales and related buying and occupancy costs (9,168) Selling, general and administrative expenses (4,168) Earnings before interest and income taxes 1,101 Interest expense, net (125) Earnings before income taxes 976 Income tax expense (376) Net earnings $ 600 Compute NOPAT for Nordstrom for 2016. (Hint: Treat credit card revenues as operating.) a. $ 679 million b. $1,136 million c. $ 851 million d. $ 725 million
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Following is the income statement for Nordstrom Company. Assume that the combined federal and
state statutory tax rate is 37%.
($ millions)
2016
Net sales
$14,095
Credit card revenues
342
Total revenues
14,437
Cost of sales and related buying and occupancy costs
(9,168)
Selling, general and administrative expenses
(4,168)
Earnings before interest and income taxes
1,101
Interest expense, net
(125)
Earnings before income taxes
976
Income tax expense
(376)
Net earnings
$
600
Compute NOPAT for Nordstrom for 2016. (Hint: Treat credit card revenues as operating.)
a. $ 679 million
b. $1,136 million
c. $ 851 million
d. $ 725 million
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