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By what name does Target label its income statement?

What amounts did Target report for items listed below for the year ended February 1, 2020?

Note: Enter your answers in millions (i.e., 10,000,000 should be entered as 10).

Sales
Cost of goods sold (labeled cost of sales)
Earnings from continuing operations before income taxes
Net earnings from continuing operations
Net earnings
Does Target report any items as part of its other comprehensive income?

Does Target prepare the statement of cash flows using the direct method or the indirect method?

Which is higher, net earnings or operating cash flows, and what is the biggest reason why?

What is the largest investing cash flow and the largest financing cash flow reported by the company for the year ended February 1, 2020?

User Gie
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1 Answer

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Final answer:

Target's income statement is called the Consolidated Statement of Operations, and for the year ended February 1, 2020, it reported sales of $78,112 million and other key financial figures. Target uses the indirect method for its statement of cash flows, with operating cash flows typically higher than net earnings due to non-cash expenses reconciliation. The largest investing and financing cash flows were capital expenditures and repayments of short-term borrowings, respectively.

Step-by-step explanation:

Target labels its income statement as the Consolidated Statement of Operations. For the year ended February 1, 2020, Target reported the following amounts (in millions):

• Sales: $78,112

• Cost of goods sold (labeled cost of sales): $55,651

• Earnings from continuing operations before income taxes: $4,601

• Net earnings from continuing operations: $3,281

• Net earnings: $3,280

Yes, Target does report items as part of its other comprehensive income. These can include foreign currency translation adjustments, unrealized gains or losses on derivative instruments, and pension and postretirement benefit plan re-measurements.

Target prepares the statement of cash flows using the indirect method. When comparing net earnings to operating cash flows, the latter is typically higher. This is mainly due to the fact that the operating cash flows include non-cash expenses such as depreciation and amortization which are added back to net income. Reconciling items between net income and cash provided by operating activities can account for this difference. For the largest investing cash flow for the year ended February 1, 2020, it was capital expenditures at $3,114 million. The largest financing cash flow was repayments of short-term borrowings, which amounted to $3,401 million.

User Gregw
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