Revenue Recognition

12 Months Ended

Feb. 02, 2019

Revenue From Contract With Customer [Abstract]

Revenue Recognition

2. Revenue Recognition

Effective February 4, 2018, we adopted Revenue from Contracts with Customers (ASC Topic 606) as required. We adopted the new standard using the full retrospective method.  The standard eliminated the transaction and industry specific revenue recognition guidance under prior U.S. GAAP and replaced it with the principles-based approach for revenue recognition and disclosures.  Under the standard, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services.

The following tables summarize the impact of adoption of the new standard by financial statement line item:

2017 (Dollars in Millions, Except per Share Data)	As Previously Reported		New Standard Adjustment			Adjusted
Net sales	$	19,095	$	(59	)	$	19,036
Other revenue				1,048			1,048
Total revenue				989			20,084
Cost of merchandise sold		12,176		-			12,176
Gross margin		6,919
Operating expenses:
Selling, general and administrative		4,512		989			5,501
Depreciation and amortization		991		-			991
Operating income		1,416		-			1,416
Interest expense, net		299		-			299
Income before income taxes		1,117		-			1,117
Provision for income taxes		258		-			258
Net income	$	859	$	-		$	859
Net income per share:
Basic	$	5.14	$	-		$	5.14
Diluted	$	5.12	$	-		$	5.12

2016 (Dollars in Millions, Except per Share Data)	As Previously Reported		New Standard Adjustment			Adjusted
Net sales	$	18,686	$	(50	)	$	18,636
Other revenue				1,045			1,045
Total revenue				995			19,681
Cost of merchandise sold		11,944					11,944
Gross margin		6,742
Operating expenses:
Selling, general and administrative		4,435		995			5,430
Depreciation and amortization		938		-			938
Impairments, store closing and other costs		186		-			186
Operating income		1,183		-			1,183
Interest expense, net		308		-			308
Income before income taxes		875		-			875
Provision for income taxes		319		-			319
Net income	$	556	$	-		$	556
Net income per share:
Basic	$	3.12	$	-		$	3.12
Diluted	$	3.11	$	-		$	3.11

February 3, 2018 (Dollars in Millions)	As Previously Reported		New Standard Adjustment			Adjusted
Assets
Current assets:
Cash and cash equivalents	$	1,308	$	-		$	1,308
Merchandise inventories		3,542		-			3,542
Other		481		49			530
Total current assets		5,331		49			5,380
Property and equipment, net		7,773		-			7,773
Other assets		236		-			236
Total assets	$	13,340	$	49		$	13,389
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	1,271	$	-		$	1,271
Accrued liabilities		1,155		58			1,213
Income taxes payable		99		-			99
Current portion of capital lease and financing obligations		126		-			126
Total current liabilities		2,651		58			2,709
Long-term debt		2,797		-			2,797
Capital lease and financing obligations		1,591		-			1,591
Deferred income taxes		213		(2	)		211
Other long-term liabilities		662		-			662
Total shareholders’ equity		5,426		(7	)		5,419
Total liabilities and shareholders’ equity	$	13,340	$	49		$	13,389

The adoption of the new standard had no impact on our basic or diluted earnings per share or our net cash provided by (used in) operating, financing, or investing activities.