Information is provided below for Federated Department Stores, owner of several department store chains, including Bloomingdale’s, Macy’s, and The Broadway. The amounts given are from Federated’s annual report for the year ended February 2, 2002.
|
(In millions) |
Fiscal 2001 |
Fiscal 2000 |
|
Sales |
$15,651 |
$16,638 |
|
Cost of goods sold |
9,584 |
9,955 |
|
Operating income |
1,104 |
1,691 |
|
Net income (loss) |
276 |
184 |
|
Accounts receivable |
2,379 |
2,435 |
|
Merchandise inventories |
3,376 |
3,626 |
|
Total assets |
15,044 |
15,574 |
|
Cash provided by operating activities |
1,372 |
1,332 |
Calculate inventory turnover, accounts receivable turnover, gross profit margin, and operating profit margin. Compare your results with those for Wal Mart shown below. To what extent are the differences explained by the differing operating strategies of the two retailers?
|
Wal Mart |
||
|
(In millions) |
2002 |
2001 |
|
Inventory turnover |
7.6 |
7 |
|
Accounts receivable turnover |
108.9 |
108.2 |
|
Gross profit margin |
21.20% |
21.40% |
|
Operating profit margin |
4.60% |
5.00% |