Reference no: EM133434324

Consolidated Balance Sheets
$ in Millions	Classification	2016	2015
Current assets:
Cash and cash equivalents	FA	$ 558	$ 405
Short-term investments	FA	100	307
Merchandise inventory - net	OA	10,458	9,458
Other current assets	OA	884	391
Total current assets		12,000	10,561
Property, less accumulated depreciation	OA	19,949	19,577
Long-term investments	OA	366	222
Deferred income taxes - net	OA	222	241
Goodwill	OA	1,082	154
Other assets	OA	789	511
Total assets		34,408	31,266
Current liabilities:
Short-term borrowings	FL	510	43
Current maturities of long-term debt	FL	795	1,061
Accounts payable	OL	6,651	5,633
Accrued compensation and employee benefits	OL	790	820
Deferred revenue	OL	1,253	1,078
Other current liabilities	OL	1,975	1,857
Total current liabilities		11,974	10,492
Long-term debt, excluding current maturities	FL	14,394	11,545
Deferred revenue - extended protection plans	OL	763	729
Other liabilities	OL	843	846
Total liabilities		27,974	23,612
Commitments and contingencies
Shareholders' equity:
Preferred stock - $5 par value, none issued		0	0
Common stock - $.50 par value; Shares issued and outstanding 866 at February 3, 2017 and 910 at January 29, 2016, respectively		433	455
Capital in excess of par value		0	0
Retained earnings		6,241	7,593
Accumulated other comprehensive loss		(240)	(394)
Total shareholders' equity		6,434	7,654
Total liabilities and shareholders' equity		$ 34,408	$ 31,266

 Reformulate financial statement and perform profitability and risk analysis for LOWES. (Use the provided Excel template to finish your work. You must submit your Excel file to show your work.) 

A. Prepare reformulated income statements for fiscal year 2016 and 2015 and reformulated balance sheets for 2016 and 2015 in a way that distinguishes operating and financing activities and identifies taxes applicable to various components of income. B. For fiscal year 2016, calculate the following: return on common equity (ROE), return on net operating assets (RNOA), and net borrowing cost (NBC). Use average balance sheet amounts in denominators. 

C. Calculate the financing leverage ratio (FLEV) at the beginning of the year and show that the following leverage equation for 2016 is satisfied: ROE = RNOA + [FLEV × (RNOA - NBC)] 

D. Calculate the net operating profit margin ratio (NOPM) and the net operating asset turnover NOAT.

 E. Calculate the current ratios and quick ratios for 2016 and 2015.

 F. Calculate the liabilities-to-equity ratios and total debt-to-equity ratios for 2016 and 2015. 

G. Calculate the interest coverage ratios for 2016 and 2015.

 H. Calculate the account receivable turnover ratio, inventory turnover ratio, and account payable turnover ratio for 2016.

 I. Calculate the days account receivable outstanding, days inventory outstanding, days account payable outstanding, and days financing required for 2016.