Following are financial statement numbers and ratios for CVS Caremark for the ye

Question

Following are financial statement numbers and ratios for CVS Caremark for the year ended December 31, 2013. If we anticipate a 4% sales growth in 2014, what is the company’s projected net operating assets (NOA) for 2014?

Total revenue (in millions)                                             $126,761
Net operating profit margin (NOPM)                                    3.9%
Net operating assets as a percent of revenues                   37.1%

$48,909 million

$4,944 million

$47,028 million

$5,141 million

$48,909 million

$4,944 million

$47,028 million

$5,141 million

Explanation / Answer

Projected sales= 126761*1.04= 131831.44

Projected net operating assets=131831.44 *37.1%= 48909.46 million= 48909 (rounded off)

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