Continuing Company Analysis—Amazon, Best Buy, and Walmart: Free cash flow Amazon.com, Inc. is one of the largest Internet retailers in the world. Best Buy, Inc. is a leading retailer of consumer electronics and media products in the United States, while Walmart Stores, Inc. is the leading retailer in the United States. Amazon, Best Buy, and Walmart compete in similar markets. Best Buy and Walmart sell through both traditional retail stores and the Internet, while Amazon sells only through the Internet. Sales and cash flow information from recent annual reports for all three companies is as follows (in millions): Amazon Best Buy Walmart Sales $88,988 $40,339 5485,651 Cash flows from operating activities 6,842 1,935 28,564 Purchases of property, plant, and equipment 4,893 561 12,174 A. Determine the free cash flow for all three companies. B. Compute the ratio of free cash flow to sales for all three companies. (Round percentages to one decimal place.) C. How docs Amazon compare to the other two companies with respect to generating free cash flow?

BuyFind

Corporate Financial Accounting

14th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781305653535
BuyFind

Corporate Financial Accounting

14th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781305653535

Solutions

Chapter
Section
Chapter 13, Problem 13.1ADM
Textbook Problem

Continuing Company Analysis—Amazon, Best Buy, and Walmart:

Free cash flow

Amazon.com, Inc. is one of the largest Internet retailers in the world. Best Buy, Inc. is a leading retailer of consumer electronics and media products in the United States, while Walmart Stores, Inc. is the leading retailer in the United States. Amazon, Best Buy, and Walmart compete in similar markets. Best Buy and Walmart sell through both traditional retail stores and the Internet, while Amazon sells only through the Internet. Sales and cash flow information from recent annual reports for all three companies is as follows (in millions):

Amazon Best Buy Walmart
Sales $88,988 $40,339 5485,651
Cash flows from operating activities 6,842 1,935 28,564
Purchases of property, plant, and equipment 4,893 561 12,174
  1. A. Determine the free cash flow for all three companies.
  2. B. Compute the ratio of free cash flow to sales for all three companies. (Round percentages to one decimal place.)
  3. C. How docs Amazon compare to the other two companies with respect to generating free cash flow?

Expert Solution

Want to see the full answer?

Check out a sample textbook solution.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.

Chapter 13 Solutions

Corporate Financial Accounting
Ch. 13 - Classifying cash flows Identify whether each of...Ch. 13 - Adjustments to net incomeindirect method Ripley...Ch. 13 - Changes in current operating assets and...Ch. 13 - Cash flows from operating activitiesindirect...Ch. 13 - Land transactions on the statement of cash flows...Ch. 13 - Common stock transactions on the statement of cash...Ch. 13 - Appendix 2 Cash received from customersdirect...Ch. 13 - Reporting changes in equipment on statement of...Ch. 13 - Cash flows from operating activitiesnet loss...Ch. 13 - Effect of transactions on cash flows State the...Ch. 13 - Classifying cash flows Identify the type of cash...Ch. 13 - Cash flows from operating activitiesindirect...Ch. 13 - Cash flows from operating activities indirect...Ch. 13 - Cash flows from operating activitiesindirect...Ch. 13 - Cash flows from operating activitiesindirect...Ch. 13 - Reporting changes in equipment on statement of...Ch. 13 - Reporting changes in equipment on statement of...Ch. 13 - Reporting land transactions on statement of cash...Ch. 13 - Determining cash payments to stockholders The...Ch. 13 - Reporting stockholders' equity items on statement...Ch. 13 - Reporting land acquisition for cash and mortgage...Ch. 13 - Reporting issuance and retirement of long-term...Ch. 13 - Determining net income from net cash flow from...Ch. 13 - Cash flows from operating activitiesindirect...Ch. 13 - Statement of cash flowsindirect method The...Ch. 13 - Statement of cash flowsindirect method List the...Ch. 13 - Cash flows from operating activitiesdirect method...Ch. 13 - Determining selected amounts for cash flows from...Ch. 13 - Cash flows from operating activities direct method...Ch. 13 - Cash flows from operating activitiesdirect method...Ch. 13 - Statement of cash flowsindirect method The...Ch. 13 - Statement of cash flowsindirect method The...Ch. 13 - Statement of cash flowsindirect method The...Ch. 13 - Statement of cash flowsdirect method The...Ch. 13 - Statement of cash flows direct method applied to...Ch. 13 - Statement of cash flowsindirect method The...Ch. 13 - Statement of cash flows indirect method The...Ch. 13 - Statement of cash flowsindirect method The...Ch. 13 - Statement of cash flows direct method The...Ch. 13 - Statement of cash flowsdirect method applied to PR...Ch. 13 - Continuing Company AnalysisAmazon, Best Buy, and...Ch. 13 - RadioShack: Free cash flow RadioShack Corporation...Ch. 13 - ATT and Facebook: Free cash flow ATT Inc. is a...Ch. 13 - Priceline: Free cash flow Priceline Group, Inc. is...Ch. 13 - Ethics in Action Head Donuts Inc. is a retailer of...Ch. 13 - Communication Tidewater Inc., a retailer, provided...

Additional Business Textbook Solutions

Find more solutions based on key concepts
SECURITY MARKET LINE You plan to invest in the Kish Hedge Fund, which has total capital of 500 million invested...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)

Explain the seven major warehousing activities.

Foundations of Business (MindTap Course List)