Determine the missing amounts


Determine the missing amounts (in millions) for the condensed balance sheets shown below.

Costco   (COST)                                 Target   (TGT)                     Wal-Mart  (WMT)

Assets                                   $77,540                 $75,155                                $ __________________

Liabilities                              54,278                                   $_____________           $169,095

Stockholders’ equity                                                       41,335                                   143,731


Though the McDonald’s (MCD) menu of hamburgers, cheeseburgers, the Big Mac®, Quarter Pounder®, the Filet-O-Fish®, and Chicken McNuggets® is easily recognized, McDonald’s financial statements may not be as familiar. The following items were adapted from a recent annual report of McDonald’s Corporation:

  1. Accounts payable
  2. Accrued interest payable
  3. Cash
  4. Cash provided by operations
  5. Common Stock
  6. Food and packaging costs used in operations
  7. Income tax expense
  8. Interest expense
  9. Inventories
  10. Long-term debt payable
  11. Net income
  12. Net increase in cash
  13. Notes payable
  14. Notes receivable
  15. Occupancy and rent expense
  16. Payroll expense
  17. Prepaid expenses not yet used in operations
  18. Property and equipment
  19. Retained earnings
  20. Sales

Identify the financial statement on which each of the preceding items would appear. If an item appears on more than one statement, select the choice that includes both statements. Use the following notations:

IS                            Income statement

SE                           Statement of stockholders’ equity

BS                           Balance sheet

SCF                         Statement of cash flows


Match each of the following statements with the appropriate accounting concept. Some concepts may be used more than once, while others may not be used at all.

Accounting Concept                       Notation

Accounting period concept                          P

Adequate disclosure concept                     D

Business entity concept                                B

Cost concept                                                      C

Going concern concept                                 G

Matching concept                                            M

Objectivity concept                                         O

Unit of measure concept                              U

Use the notations shown to indicate the appropriate accounting concept.


  1. Assume that a business will continue forever.
  2. Material litigation involving the corporation is described in a note.
  3. Monthly utilities costs are reported as expenses along with the monthly revenues.
  4. Personal transactions of owners are kept separate from the business.
  5. This concept supports relying on an independent actuary (statistician), rather than the chief operating officer of the corporation, to estimate a pension liability.
  6. Changes in the use of accounting methods from one period to the next are described in the notes to the financial statements.
  7. Land worth $800,000 is reported at its original purchase price of $220,000.
  8. This concept justifies recording only transactions that are expressed in dollars.
  9. If this concept was ignored, the confidence of users in the financial statements could not be maintained.
  10. The changes in financial condition are reported at the end of the month.


The following financial data were adapted from a recent annual report of Target Corporation for the year ending January 31.

In millions

Accounts payable                                                                                            $17,143

Cash                                                                                                                      1,985

Common stock                                                                                                  7,155

Cost of goods sold                                                                                           119,650

Debt and other borrowings                                                                         43,708

Income tax expense                                                                                       3,818

Interest expense                                                                                             2,165

Inventories                                                                                                         19,795

Other assets                                                                                                      7,105

Other expenses                                                                                                               6,443

Other liabilities                                                                                                  16,173

Property, plant, and equipment                                                                                72,873

Sales                                                                                                                      171,165

Selling, general, and administrative expenses                                     35,265


  1. Prepare Target’s income statement for the year ending January 31.
  2. Prepare Target’s retained earnings statement for the year ending January 31, 20Y2. If an amount box is zero, enter “0”.

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