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:
- Accounts payable
- Accrued interest payable
- Cash provided by operations
- Common Stock
- Food and packaging costs used in operations
- Income tax expense
- Interest expense
- Long-term debt payable
- Net income
- Net increase in cash
- Notes payable
- Notes receivable
- Occupancy and rent expense
- Payroll expense
- Prepaid expenses not yet used in operations
- Property and equipment
- Retained earnings
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.
- Assume that a business will continue forever.
- Material litigation involving the corporation is described in a note.
- Monthly utilities costs are reported as expenses along with the monthly revenues.
- Personal transactions of owners are kept separate from the business.
- This concept supports relying on an independent actuary (statistician), rather than the chief operating officer of the corporation, to estimate a pension liability.
- Changes in the use of accounting methods from one period to the next are described in the notes to the financial statements.
- Land worth $800,000 is reported at its original purchase price of $220,000.
- This concept justifies recording only transactions that are expressed in dollars.
- If this concept was ignored, the confidence of users in the financial statements could not be maintained.
- 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.
Accounts payable $17,143
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
Other assets 7,105
Other expenses 6,443
Other liabilities 16,173
Property, plant, and equipment 72,873
Selling, general, and administrative expenses 35,265
- Prepare Target’s income statement for the year ending January 31.
- Prepare Target’s retained earnings statement for the year ending January 31, 20Y2. If an amount box is zero, enter “0”.