Financial Statement Analysis and Comparison of Kroger and Whole Foods

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ACC 300 FSA Project Ratio Analysis of The Kroger Co. and Whole Foods Market, Inc. TEAM Jake Eriksen (002) Brycen Goldstein (002) 16 Ross Wright (001) Nicolas Kim Omar Harb (001) (002) Kroger The Kroger Co. (referred to as Kroger) is a large grocery chain audited by PricewaterhouseCoopers LLP. Kroger ended its FY 2012 on February 2, 2013, FY 2013 on February 1, 2014, and FY 2014 on January 31, 2015 (Saturday nearest January 31). From page 39, we are told that 95% of inventories in 2014 and 2013 were counted using a LIFO costing method, stating the lower of cost or market. However, Kroger’s fuel inventory levels are determined using the FIFO cost method. The company uses the Link-Chain, Dollar-Value…show more content…
On page 40, we are told that Whole Foods uses the straight line method for the depreciation of property and equipment, including depreciation of equipment over useful lives (3-15 years), amortization of leasehold improvements and real estate assets under capital leases, and depreciation of buildings (20-50 years). When assets are retired or disposed, costs and accumulated depreciation are removed from the balance sheet and gains or losses are then reflected in earnings. Net Cash Provided by Operating Activities 1150 Dollars (in millions) 1100 1088 1050 1009 1000 950 920 900 850 800 2014 2013 Year 3 2012 Kroger RATIO Current Ratio EQUATION RESULT 8,911 11,403 = 0.781 Return on Assets (30,556+29,281)/2 Return on Equity Return on Sales 1,728 ℎℎ ′ ℎℎ ℎ . # ℎ (5,442+5,395)/2 1,728 EPS Diluted EPS ℎℎ ℎ . ℎ + 2,070.4 = 0.016 108,465 1,728−17 490 1,711 490+7 = 3.492 = 3.443 /365 (1,266+1,116)/2 Debt to Equity ℎℎ ′ 9,771+1,885 Dividend Payout Inventory Turnover = 0.069 Working backwards from the income tax expense, we estimate income tax rate to be 34%. NOPAT is then Operating profit taxes, or 3,137*(1-0.34) = 0.319 Average

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