Inventory Disclosure
Adjustment to Inventory: Conversion from LIFO to FIFO
Adjusted Financial Ratios: LIFO vs. FIFO (Summary)
Adjusted Current Ratio
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Costco Wholesale Corp., balance sheet: inventory

US$ in millions

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
United States	12,153)	13,160)	10,248)	8,871)	8,415)	8,081)
Canada	1,579)	1,966)	1,456)	1,310)	1,123)	1,189)
Other International	2,919)	2,781)	2,511)	2,061)	1,857)	1,770)
Merchandise inventories	16,651)	17,907)	14,215)	12,242)	11,395)	11,040)

Based on: 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), 10-K (reporting date: 2018-09-02).

Download chart

Item	Description	The company
Merchandise inventories	Amount after valuation and LIFO reserves of inventory expected to be sold, or consumed within one year or operating cycle, if longer.	Costco Wholesale Corp. merchandise inventories increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Adjusting LIFO Inventory to FIFO (Current) Cost

US$ in millions

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
Adjustment to Merchandise Inventories
Merchandise inventories at LIFO (as reported)	16,651)	17,907)	14,215)	12,242)	11,395)	11,040)
Add: Inventory LIFO reserve	—)	438)	—)	—)	—)	—)
Merchandise inventories at FIFO (adjusted)	16,651)	18,345)	14,215)	12,242)	11,395)	11,040)
Adjustment to Current Assets
Current assets (as reported)	35,879)	32,696)	29,505)	28,120)	23,485)	20,289)
Add: Inventory LIFO reserve	—)	438)	—)	—)	—)	—)
Current assets (adjusted)	35,879)	33,134)	29,505)	28,120)	23,485)	20,289)
Adjustment to Total Assets
Total assets (as reported)	68,994)	64,166)	59,268)	55,556)	45,400)	40,830)
Add: Inventory LIFO reserve	—)	438)	—)	—)	—)	—)
Total assets (adjusted)	68,994)	64,604)	59,268)	55,556)	45,400)	40,830)
Adjustment to Total Costco Stockholders’ Equity
Total Costco stockholders’ equity (as reported)	25,058)	20,642)	17,564)	18,284)	15,243)	12,799)
Add: Inventory LIFO reserve	—)	438)	—)	—)	—)	—)
Total Costco stockholders’ equity (adjusted)	25,058)	21,080)	17,564)	18,284)	15,243)	12,799)
Adjustment to Net Income Attributable To Costco
Net income attributable to Costco (as reported)	6,292)	5,844)	5,007)	4,002)	3,659)	3,134)
Add: Increase (decrease) in inventory LIFO reserve	(438)	438)	—)	—)	—)	64)
Net income attributable to Costco (adjusted)	5,854)	6,282)	5,007)	4,002)	3,659)	3,198)

Based on: 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), 10-K (reporting date: 2018-09-02).

Costco Wholesale Corp. inventory value on Sep 3, 2023 would be $16,651) (in millions) if the FIFO inventory method was used instead of LIFO. Costco Wholesale Corp. inventories, valued on a LIFO basis, on Sep 3, 2023 were $16,651). Costco Wholesale Corp. inventories would have been $—) higher than reported on Sep 3, 2023 if the FIFO method had been used instead.

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

Download chart

Costco Wholesale Corp., adjusted financial ratios

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
Current Ratio
Reported current ratio (LIFO)	1.07	1.02	1.00	1.13	1.01	1.02
Adjusted current ratio (FIFO)	1.07	1.04	1.00	1.13	1.01	1.02
Net Profit Margin
Reported net profit margin (LIFO)	2.65%	2.62%	2.61%	2.45%	2.45%	2.26%
Adjusted net profit margin (FIFO)	2.46%	2.82%	2.61%	2.45%	2.45%	2.31%
Total Asset Turnover
Reported total asset turnover (LIFO)	3.45	3.47	3.24	2.94	3.29	3.39
Adjusted total asset turnover (FIFO)	3.45	3.45	3.24	2.94	3.29	3.39
Financial Leverage
Reported financial leverage (LIFO)	2.75	3.11	3.37	3.04	2.98	3.19
Adjusted financial leverage (FIFO)	2.75	3.06	3.37	3.04	2.98	3.19
Return on Equity (ROE)
Reported ROE (LIFO)	25.11%	28.31%	28.51%	21.89%	24.00%	24.49%
Adjusted ROE (FIFO)	23.36%	29.80%	28.51%	21.89%	24.00%	24.99%
Return on Assets (ROA)
Reported ROA (LIFO)	9.12%	9.11%	8.45%	7.20%	8.06%	7.68%
Adjusted ROA (FIFO)	8.48%	9.72%	8.45%	7.20%	8.06%	7.83%

Based on: 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), 10-K (reporting date: 2018-09-02).

Financial ratio	Description	The company
Adjusted current ratio	A liquidity ratio calculated as adjusted current assets divided by current liabilities.	Costco Wholesale Corp. adjusted current ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Costco Wholesale Corp. adjusted net profit margin ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Costco Wholesale Corp. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
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 2021 to 2022 and from 2022 to 2023.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Costco Wholesale Corp. adjusted ROE improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Costco Wholesale Corp. adjusted ROA improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

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

Download chart

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
As Reported
Selected Financial Data (US$ in millions)
Current assets	35,879)	32,696)	29,505)	28,120)	23,485)	20,289)
Current liabilities	33,583)	31,998)	29,441)	24,844)	23,237)	19,926)
Liquidity Ratio
Current ratio¹	1.07	1.02	1.00	1.13	1.01	1.02
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted current assets	35,879)	33,134)	29,505)	28,120)	23,485)	20,289)
Current liabilities	33,583)	31,998)	29,441)	24,844)	23,237)	19,926)
Liquidity Ratio
Adjusted current ratio²	1.07	1.04	1.00	1.13	1.01	1.02

Based on: 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), 10-K (reporting date: 2018-09-02).

2023 Calculations

¹ Current ratio = Current assets ÷ Current liabilities
= 35,879 ÷ 33,583 = 1.07

² Adjusted current ratio = Adjusted current assets ÷ Current liabilities
= 35,879 ÷ 33,583 = 1.07

Download chart

Liquidity ratio	Description	The company
Adjusted current ratio	A liquidity ratio calculated as adjusted current assets divided by current liabilities.	Costco Wholesale Corp. adjusted current ratio improved from 2021 to 2022 and from 2022 to 2023.

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Costco	6,292)	5,844)	5,007)	4,002)	3,659)	3,134)
Net sales	237,710)	222,730)	192,052)	163,220)	149,351)	138,434)
Profitability Ratio
Net profit margin¹	2.65%	2.62%	2.61%	2.45%	2.45%	2.26%
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted net income attributable to Costco	5,854)	6,282)	5,007)	4,002)	3,659)	3,198)
Net sales	237,710)	222,730)	192,052)	163,220)	149,351)	138,434)
Profitability Ratio
Adjusted net profit margin²	2.46%	2.82%	2.61%	2.45%	2.45%	2.31%

Based on: 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), 10-K (reporting date: 2018-09-02).

2023 Calculations

¹ Net profit margin = 100 × Net income attributable to Costco ÷ Net sales
= 100 × 6,292 ÷ 237,710 = 2.65%

² Adjusted net profit margin = 100 × Adjusted net income attributable to Costco ÷ Net sales
= 100 × 5,854 ÷ 237,710 = 2.46%

Download chart

Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Costco Wholesale Corp. adjusted net profit margin ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
As Reported
Selected Financial Data (US$ in millions)
Net sales	237,710)	222,730)	192,052)	163,220)	149,351)	138,434)
Total assets	68,994)	64,166)	59,268)	55,556)	45,400)	40,830)
Activity Ratio
Total asset turnover¹	3.45	3.47	3.24	2.94	3.29	3.39
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Net sales	237,710)	222,730)	192,052)	163,220)	149,351)	138,434)
Adjusted total assets	68,994)	64,604)	59,268)	55,556)	45,400)	40,830)
Activity Ratio
Adjusted total asset turnover²	3.45	3.45	3.24	2.94	3.29	3.39

Based on: 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), 10-K (reporting date: 2018-09-02).

2023 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 237,710 ÷ 68,994 = 3.45

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 237,710 ÷ 68,994 = 3.45

Download chart

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 improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
As Reported
Selected Financial Data (US$ in millions)
Total assets	68,994)	64,166)	59,268)	55,556)	45,400)	40,830)
Total Costco stockholders’ equity	25,058)	20,642)	17,564)	18,284)	15,243)	12,799)
Solvency Ratio
Financial leverage¹	2.75	3.11	3.37	3.04	2.98	3.19
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted total assets	68,994)	64,604)	59,268)	55,556)	45,400)	40,830)
Adjusted total Costco stockholders’ equity	25,058)	21,080)	17,564)	18,284)	15,243)	12,799)
Solvency Ratio
Adjusted financial leverage²	2.75	3.06	3.37	3.04	2.98	3.19

Based on: 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), 10-K (reporting date: 2018-09-02).

2023 Calculations

¹ Financial leverage = Total assets ÷ Total Costco stockholders’ equity
= 68,994 ÷ 25,058 = 2.75

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Costco stockholders’ equity
= 68,994 ÷ 25,058 = 2.75

Download chart

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 2021 to 2022 and from 2022 to 2023.

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Costco	6,292)	5,844)	5,007)	4,002)	3,659)	3,134)
Total Costco stockholders’ equity	25,058)	20,642)	17,564)	18,284)	15,243)	12,799)
Profitability Ratio
ROE¹	25.11%	28.31%	28.51%	21.89%	24.00%	24.49%
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted net income attributable to Costco	5,854)	6,282)	5,007)	4,002)	3,659)	3,198)
Adjusted total Costco stockholders’ equity	25,058)	21,080)	17,564)	18,284)	15,243)	12,799)
Profitability Ratio
Adjusted ROE²	23.36%	29.80%	28.51%	21.89%	24.00%	24.99%

Based on: 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), 10-K (reporting date: 2018-09-02).

2023 Calculations

¹ ROE = 100 × Net income attributable to Costco ÷ Total Costco stockholders’ equity
= 100 × 6,292 ÷ 25,058 = 25.11%

² Adjusted ROE = 100 × Adjusted net income attributable to Costco ÷ Adjusted total Costco stockholders’ equity
= 100 × 5,854 ÷ 25,058 = 23.36%

Download chart

Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Costco Wholesale Corp. adjusted ROE improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

	Sep 3, 2023	Aug 28, 2022	Aug 29, 2021	Aug 30, 2020	Sep 1, 2019	Sep 2, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Costco	6,292)	5,844)	5,007)	4,002)	3,659)	3,134)
Total assets	68,994)	64,166)	59,268)	55,556)	45,400)	40,830)
Profitability Ratio
ROA¹	9.12%	9.11%	8.45%	7.20%	8.06%	7.68%
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted net income attributable to Costco	5,854)	6,282)	5,007)	4,002)	3,659)	3,198)
Adjusted total assets	68,994)	64,604)	59,268)	55,556)	45,400)	40,830)
Profitability Ratio
Adjusted ROA²	8.48%	9.72%	8.45%	7.20%	8.06%	7.83%

Based on: 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), 10-K (reporting date: 2018-09-02).

2023 Calculations

¹ ROA = 100 × Net income attributable to Costco ÷ Total assets
= 100 × 6,292 ÷ 68,994 = 9.12%

² Adjusted ROA = 100 × Adjusted net income attributable to Costco ÷ Adjusted total assets
= 100 × 5,854 ÷ 68,994 = 8.48%

Download chart

Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Costco Wholesale Corp. adjusted ROA improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

Costco Wholesale Corp. (NASDAQ:COST)

Analysis of Inventory

Inventory Disclosure

Adjustment to Inventory: Conversion from LIFO to FIFO

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

Adjusted Financial Ratios: LIFO vs. FIFO (Summary)

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

Adjusted Current Ratio

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)