Adjustments to Financial Statements: Removal of Goodwill
Adjusted Financial Ratios: Removal of Goodwill (Summary)
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Costco Wholesale Corp., adjustments to financial statements

US$ in millions

	Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019
Adjustment to Total Assets
Total assets (as reported)	69,831)	68,994)	64,166)	59,268)	55,556)	45,400)
Less: Goodwill	994)	994)	993)	996)	988)	53)
Total assets (adjusted)	68,837)	68,000)	63,173)	58,272)	54,568)	45,347)
Adjustment to Total Costco Stockholders’ Equity
Total Costco stockholders’ equity (as reported)	23,622)	25,058)	20,642)	17,564)	18,284)	15,243)
Less: Goodwill	994)	994)	993)	996)	988)	53)
Total Costco stockholders’ equity (adjusted)	22,628)	24,064)	19,649)	16,568)	17,296)	15,190)

Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).

Costco Wholesale Corp., Financial Data: Reported vs. Adjusted

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Costco Wholesale Corp., adjusted financial ratios

	Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019
Total Asset Turnover
Reported total asset turnover	3.57	3.45	3.47	3.24	2.94	3.29
Adjusted total asset turnover	3.63	3.50	3.53	3.30	2.99	3.29
Financial Leverage
Reported financial leverage	2.96	2.75	3.11	3.37	3.04	2.98
Adjusted financial leverage	3.04	2.83	3.22	3.52	3.15	2.99
Return on Equity (ROE)
Reported ROE	31.19%	25.11%	28.31%	28.51%	21.89%	24.00%
Adjusted ROE	32.56%	26.15%	29.74%	30.22%	23.14%	24.09%
Return on Assets (ROA)
Reported ROA	10.55%	9.12%	9.11%	8.45%	7.20%	8.06%
Adjusted ROA	10.70%	9.25%	9.25%	8.59%	7.33%	8.07%

Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).

Financial ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Costco Wholesale Corp. adjusted total asset turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Costco Wholesale Corp. adjusted financial leverage ratio decreased from 2022 to 2023 but then increased from 2023 to 2024 not reaching 2022 level.
Adjusted ROE	A profitability ratio calculated as net income divided by adjusted shareholders’ equity.	Costco Wholesale Corp. adjusted ROE deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Costco Wholesale Corp. adjusted ROA improved from 2022 to 2023 and from 2023 to 2024.

Costco Wholesale Corp., Financial Ratios: Reported vs. Adjusted

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	Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019
As Reported
Selected Financial Data (US$ in millions)
Net sales	249,625)	237,710)	222,730)	192,052)	163,220)	149,351)
Total assets	69,831)	68,994)	64,166)	59,268)	55,556)	45,400)
Activity Ratio
Total asset turnover¹	3.57	3.45	3.47	3.24	2.94	3.29
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net sales	249,625)	237,710)	222,730)	192,052)	163,220)	149,351)
Adjusted total assets	68,837)	68,000)	63,173)	58,272)	54,568)	45,347)
Activity Ratio
Adjusted total asset turnover²	3.63	3.50	3.53	3.30	2.99	3.29

Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).

2024 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 249,625 ÷ 69,831 = 3.57

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 249,625 ÷ 68,837 = 3.63

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Costco Wholesale Corp. adjusted total asset turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

	Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets	69,831)	68,994)	64,166)	59,268)	55,556)	45,400)
Total Costco stockholders’ equity	23,622)	25,058)	20,642)	17,564)	18,284)	15,243)
Solvency Ratio
Financial leverage¹	2.96	2.75	3.11	3.37	3.04	2.98
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets	68,837)	68,000)	63,173)	58,272)	54,568)	45,347)
Adjusted total Costco stockholders’ equity	22,628)	24,064)	19,649)	16,568)	17,296)	15,190)
Solvency Ratio
Adjusted financial leverage²	3.04	2.83	3.22	3.52	3.15	2.99

Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).

2024 Calculations

¹ Financial leverage = Total assets ÷ Total Costco stockholders’ equity
= 69,831 ÷ 23,622 = 2.96

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Costco stockholders’ equity
= 68,837 ÷ 22,628 = 3.04

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Costco Wholesale Corp. adjusted financial leverage ratio decreased from 2022 to 2023 but then increased from 2023 to 2024 not reaching 2022 level.

	Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Costco	7,367)	6,292)	5,844)	5,007)	4,002)	3,659)
Total Costco stockholders’ equity	23,622)	25,058)	20,642)	17,564)	18,284)	15,243)
Profitability Ratio
ROE¹	31.19%	25.11%	28.31%	28.51%	21.89%	24.00%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Costco	7,367)	6,292)	5,844)	5,007)	4,002)	3,659)
Adjusted total Costco stockholders’ equity	22,628)	24,064)	19,649)	16,568)	17,296)	15,190)
Profitability Ratio
Adjusted ROE²	32.56%	26.15%	29.74%	30.22%	23.14%	24.09%

Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).

2024 Calculations

¹ ROE = 100 × Net income attributable to Costco ÷ Total Costco stockholders’ equity
= 100 × 7,367 ÷ 23,622 = 31.19%

² Adjusted ROE = 100 × Net income attributable to Costco ÷ Adjusted total Costco stockholders’ equity
= 100 × 7,367 ÷ 22,628 = 32.56%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as net income divided by adjusted shareholders’ equity.	Costco Wholesale Corp. adjusted ROE deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

	Sep 1, 2024	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Costco	7,367)	6,292)	5,844)	5,007)	4,002)	3,659)
Total assets	69,831)	68,994)	64,166)	59,268)	55,556)	45,400)
Profitability Ratio
ROA¹	10.55%	9.12%	9.11%	8.45%	7.20%	8.06%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Costco	7,367)	6,292)	5,844)	5,007)	4,002)	3,659)
Adjusted total assets	68,837)	68,000)	63,173)	58,272)	54,568)	45,347)
Profitability Ratio
Adjusted ROA²	10.70%	9.25%	9.25%	8.59%	7.33%	8.07%

Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).

2024 Calculations

¹ ROA = 100 × Net income attributable to Costco ÷ Total assets
= 100 × 7,367 ÷ 69,831 = 10.55%

² Adjusted ROA = 100 × Net income attributable to Costco ÷ Adjusted total assets
= 100 × 7,367 ÷ 68,837 = 10.70%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Costco Wholesale Corp. adjusted ROA improved from 2022 to 2023 and from 2023 to 2024.

Costco Wholesale Corp. (NASDAQ:COST)

Analysis of Goodwill and Intangible Assets

Adjustments to Financial Statements: Removal of Goodwill

Costco Wholesale Corp., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Costco Wholesale Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)