Best Buy 2006 Annual Report Download - page 84

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$ in millions, except per share amounts
70
3. Investments
Debt Securities
The following table presents the amortized principalamounts, related weighted-average interest rates, maturities and major
security types for our investments in debt securities:
Feb. 25, 2006 Feb. 26, 2005
Amortized
Principal
Amount
Weighted-
Average
Interest Rate
Amortized
Principal
Amount
Weighted-
Average
Interest Rate
Short-term investments (less than one year) $3,051 4.76% $2,994 3.20%
Long-term investments (one to three years) 218 4.95% 148 3.73%
Total $ 3,269 $ 3,142
Municipal debt securities $ 3,262 $ 3,135
Debt securities issued by U.S. Treasury andother
U.S. government entities 7 7
Total $ 3,269 $ 3,142
The carrying value of our investments in debt securities
approximated fairvalue at February 25, 2006, and
February 26, 2005, due to the rapid turnover of our
portfolio and the highly liquid nature of these investments.
Therefore, there were nosignificant realized or unrealized
gains or losses.
Marketable Equity Securities
The carrying value of our investments in marketable equity
securities at February 25, 2006,and February 26, 2005,
was $28 and $8, respectively. Unrealizedgains, net of tax,
included in accumulated other comprehensive income were
$12 and$2at February 25, 2006, and February 26,
2005, respectively.
Prior to the second quarter of fiscal 2006, ourinvestments
included redeemable convertible preferred stock of Golf
Galaxy, Inc., with a $5 carrying value. In August 2005,
Golf Galaxy completed aninitial public offering (IPO) of its
common stock. Aspart of the IPO, we received $4 of
accumulated preferred dividends, which are included in net
interest income for fiscal 2006. The convertible preferred
stock was simultaneously converted into 1,492,000 shares
of common stock. In August 2005, we sold 216,000 shares
of the common stock in the IPO and recognized a $2 gain
on the sale, which is included in SG&A.