ACCT. 510 – Accounting for Business Decisions The basic financial statements of a company include the...
ACCT. 510 – Accounting for Business Decisions
The basic financial statements of a company include the balance
sheet, income statement and cash flow statement. Each statement
contains specific information about the company. When viewed
together, much can be learned about how the company operates and
the impact of decisions made during the period.
Obtain the 2017 and 2018 annual reports for Starbucks. Use the information in the financial statements to respond to the following questions:
1. Write out the basic accounting (balance sheet) equation and provide the values reported by Starbucks at September 30, 2018.
2. Did total assets increase or decrease in 2018 over the previous year?
3. How much inventory did the company have at September 30, 2018?
4. What are the major operating revenue accounts? What percentage is each to total revenues?
5. What are the major operating expense accounts? What percentage is each to total operating expenses?
6. Describe the company’s revenue recognition policy, if reported. (See significant accounting policies).
7. What is Starbuck’s gross margin in 2018? Was this an increase or decrease from 2017?
8. What type of costs do you think is included in Starbuck’s ‘Cost of Sales?’
9. How do ‘cost of sales’ differ from ‘operating expenses’
10. What inventory valuation method does the company use?
11. What were cash flows from operating activities?
12. What were cash flows from investing activities?
13. What were cash flows from financing activities?
14. What was the increase/decrease in cash in 2018 from 2017?
15. Ratio Analysis: Compute the following ratios for 2017 and 2018 for Starbucks?
a. Current Ratio
b. Quick Ratio
c. Accounts Receivable Turnover Ratio
d. Inventory Turnover Ratio
e. Debt-to-Equity Ratio
f. Return on Equity
g. Return on Assets
h. Quality of Net Income (Cash Flows from Operating Activities/Net Income)
i. Profit Margin
16. What does each ratio measure and what does your results suggest about the company?
17. If available, find the industry ratios for the most recent year, compare to your results, and discuss why you believe your company differs or is similar to the industry.
18. Were there any economy, industry or company-specific factors that impact Starbuck’s future income and growth? If so, briefly discuss.
Homework Answers
1. Balance sheet equation is given by= Total Assets = Total Liabilities+ Total Equity
Values reported by Star bucks as at 30th September 2019 is
Total assets= $ 24,156.4 M
Total Liabilities= 22,980.6 M
Total Equity= 1175.8 M
Balance sheet equation is
$24,156.4 M= 22,980.6M+1,175.8M
2. Did total assets increase or decrease in 2018 over the previous year?
Total assets in 2018 were $24,156.4 M and in 2017 it was 14,365.6 M.
So, Total assets increased by $9,790.8 M
3. How much inventory did the company have at September 30, 2018?
Company have $1,400.5 M inventory at September 30, 2018.
4. What are the major operating revenue accounts? What percentage is each to total revenues?
Company Major revenue accounts are I. Revenue from Company- Operated stores ii. Revenue from Licensed stores
Total revenue= $ 24,719.5
Revenue from Company- Operated stores = $ 19,690.3 M
=19690.3/24719.5= 79.7%
Revenue from Licensed stores= $ 2,652.2 M
Percentage to total revenue= =2652.2/24719.5= 10.7%
Add Answer to:
ACCT. 510 – Accounting for Business Decisions
The basic financial statements of a company include the...
Obtain from the internet or from the link below the 2017 and 2018 annual reports for Starbucks. Use the information in t...
Obtain from the internet or from the link below the 2017 and 2018 annual reports for Starbucks. Use the information in the financial statements to respond to the following questions: 1. Ratio Analysis: Compute the following ratios for 2017 and 2018 for Starbucks? a. Current Ratio b. Quick Ratio c. Accounts Receivable Turnover Ratio d. Inventory Turnover Ratio e. Debt-to-Equity Ratio f. Return on Equity g. Return on Assets h. Quality of Net Income (Cash Flows from Operating Activities/Net Income)...
XS Supply Company is developing its annual financial statements at December 31, 2017. The statements are...
XS Supply Company is developing its annual financial statements
at December 31, 2017. The statements are complete except for the
statement of cash flows. The completed comparative balance sheets
and income statement are summarized:
2017
2016
Balance Sheet at December 31
Cash
$
39,065
$
34,600
Accounts Receivable
46,200
36,200
Merchandise Inventory
49,700
45,100
Property and Equipment
169,750
130,000
Less: Accumulated
Depreciation
(40,200
)
(32,500
)
$
264,515
$
213,400
Accounts Payable
$
47,950
$
34,300
Wages Payable
2,435
2,700...
Portions of the financial statements for Clear Transmissions Company are provided below. CLEAR TRANSMISSIONS COMPANY Income...
Portions of the financial statements for Clear Transmissions Company are provided below. CLEAR TRANSMISSIONS COMPANY Income Statement For the Year Ended December 31, 2018 ($ in 000s) Sales $ 1,320 Cost of goods sold 500 Gross margin 820 Salaries expense $ 220 Depreciation expense 180 Patent amortization expense 10 Interest expense 40 Loss on sale of cash equivalents 6 456 Income before taxes 364 Income tax expense 182 Net Income $ 182 CLEAR TRANSMISSIONS COMPANY Selected Accounts from Comparative Balance...
Supplements Plus, Inc. Income Statement Year Ended September 30, 2018 Net Sales Revenue $ 230,000 Cost...
Supplements Plus, Inc. Income Statement Year Ended September 30, 2018 Net Sales Revenue $ 230,000 Cost of Goods Sold 93,000 Gross Profit 137,000 Operating Expenses: Salaries Expense $ 57,000 Depreciation Expense Plant Assets 28,000 Total Operating Expenses 85,000 Net Income Before Income Taxes 52,000 Income Tax Expense 8,000 $ Net Income 44,000 c. a. Acquisition of plant assets is $118,000. Of this amount, $105,000 is paid in cash and $13,000 by signing a note payable. b. Cash receipt from sale...
Booster Company is preparing its financial statements for the year ended June 30, 2018. The financial...
Booster Company is preparing its financial statements for the year ended June 30, 2018. The financial statements are complete except for the statement of cash flows. You have been asked to prepare a statement of cash flows for the year ended June 30, 2017. Download the Excel spreadsheet Booster Company A1. Required: 1. Prepare a spreadsheet to support a statement of cash flows for the year ended June 30, 2018. 2. In the Excel Worksheet column named Worksheet Entries', show...
hello please help! Statement of Cash Flows-Indirect Method The following balances are available for Chrisman Company:...
hello please help!
Statement of Cash Flows-Indirect Method The following balances are available for Chrisman Company: Cash Accounts receivable Inventory Prepaid rent Land Plant and equipment Accumulated depreciation Totals December 31 2017 2016 $8,600 $10,800 21,500 16,100 17,100 28,600 9,700 6,500 80,600 80,600 430,000 322,500 (69,900) (32,300) $497,600 $432,800 Accounts payable Income taxes payable Short-term notes payable Bonds payable Common stock Retained earnings Totals $12,900 3,200 37,600 81,000 215,000 147,900 $497,600 $10,800 5,400 26,900 108,000 161,300 120,400 $432,800 Bonds were...
Williams Company is a manufacturer of auto parts having the following financial statements for 2018-2019. Balance...
Williams Company is a manufacturer of auto parts having the following financial statements for 2018-2019. Balance Sheet December 31 2019 Cash $ 264,800 Accounts receivable 154,800 Inventory 389, eee Total current assets $ 827,899 Long-lived assets 1,680, eee Total assets $2,487,eee Current liabilities 248, eee Long-term debt 990.ea3 Shareholders' equity 1,339, eee Total debt and equity $2,487,000 2018 $ 139.ee 229,000 179,800 $ 547,899 1,540,888 $2,887,899 215,800 8 40. 1,832, 800 $2,887,899 Income Statement For the years ended December 31...
Following are the income statement and some additional information for Carolina Consulting Company. Carolina Consulting...
Following are the
income statement and some additional information for Carolina
Consulting Company.
Carolina Consulting Company
Income Statement
For the Year Ended December 31, 2018
Net sales
$
17,000
Cost of goods
sold
(2,900
)
Gross
margin
14,100
Operating
expenses
$
3,400
Depreciation
expense
1,600
(5,000
)
Income before
taxes
9,100
Income
taxes
(3,000
)
Net income
$
6,100
All sales were on credit and accounts receivable decreased by
$1,040 in 2018 compared to 2017. Merchandise purchases were...
Booster Company is preparing its financial statements for the year ended June 30, 2018. The financial...
Booster Company is preparing its financial statements for the
year ended June 30, 2018. The financial statements are complete
except for the statement of cash flows. You have been asked to
prepare a statement of cash flows for the year ended June 30,
2017.
Booster Company A1 Company Facts:
PLEASE FILL IN THE BELOW CHARTS FOR THE
ASSIGNMENT:------------------------------------------------------------------
Account Balances June 30, 2017 June 30, 2018 Debits $ $ L 361,700 100,000 11,700 1,500 168,750 45.000 Cash Accounts Receivable Marketable...
XS Supply Company is developing its annual financial statements at December 31. The statements are complete...
XS Supply Company is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized: Current Year Previous Year Balance sheet at December 31 Cash Accounts Receivable Inventory Equipment Accumulated Depreciation-Equipment Total Assets Accounts Payable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings Total Liabilities and stockholders' Equity Income Statement Sales Revenue Cost of Goods Sold other Expenses Net...
XS Supply Company is developing its annual financial statements
at December 31, 2017. The statements are complete except for the
statement of cash flows. The completed comparative balance sheets
and income statement are summarized:
2017
2016
Balance Sheet at December 31
Cash
$
39,065
$
34,600
Accounts Receivable
46,200
36,200
Merchandise Inventory
49,700
45,100
Property and Equipment
169,750
130,000
Less: Accumulated
Depreciation
(40,200
)
(32,500
)
$
264,515
$
213,400
Accounts Payable
$
47,950
$
34,300
Wages Payable
2,435
2,700...
Supplements Plus, Inc. Income Statement Year Ended September 30, 2018 Net Sales Revenue $ 230,000 Cost of Goods Sold 93,000 Gross Profit 137,000 Operating Expenses: Salaries Expense $ 57,000 Depreciation Expense Plant Assets 28,000 Total Operating Expenses 85,000 Net Income Before Income Taxes 52,000 Income Tax Expense 8,000 $ Net Income 44,000 c. a. Acquisition of plant assets is $118,000. Of this amount, $105,000 is paid in cash and $13,000 by signing a note payable. b. Cash receipt from sale...
Booster Company is preparing its financial statements for the year ended June 30, 2018. The financial statements are complete except for the statement of cash flows. You have been asked to prepare a statement of cash flows for the year ended June 30, 2017. Download the Excel spreadsheet Booster Company A1. Required: 1. Prepare a spreadsheet to support a statement of cash flows for the year ended June 30, 2018. 2. In the Excel Worksheet column named Worksheet Entries', show...
hello please help!
Statement of Cash Flows-Indirect Method The following balances are available for Chrisman Company: Cash Accounts receivable Inventory Prepaid rent Land Plant and equipment Accumulated depreciation Totals December 31 2017 2016 $8,600 $10,800 21,500 16,100 17,100 28,600 9,700 6,500 80,600 80,600 430,000 322,500 (69,900) (32,300) $497,600 $432,800 Accounts payable Income taxes payable Short-term notes payable Bonds payable Common stock Retained earnings Totals $12,900 3,200 37,600 81,000 215,000 147,900 $497,600 $10,800 5,400 26,900 108,000 161,300 120,400 $432,800 Bonds were...
Williams Company is a manufacturer of auto parts having the following financial statements for 2018-2019. Balance Sheet December 31 2019 Cash $ 264,800 Accounts receivable 154,800 Inventory 389, eee Total current assets $ 827,899 Long-lived assets 1,680, eee Total assets $2,487,eee Current liabilities 248, eee Long-term debt 990.ea3 Shareholders' equity 1,339, eee Total debt and equity $2,487,000 2018 $ 139.ee 229,000 179,800 $ 547,899 1,540,888 $2,887,899 215,800 8 40. 1,832, 800 $2,887,899 Income Statement For the years ended December 31...
Following are the
income statement and some additional information for Carolina
Consulting Company.
Carolina Consulting Company
Income Statement
For the Year Ended December 31, 2018
Net sales
$
17,000
Cost of goods
sold
(2,900
)
Gross
margin
14,100
Operating
expenses
$
3,400
Depreciation
expense
1,600
(5,000
)
Income before
taxes
9,100
Income
taxes
(3,000
)
Net income
$
6,100
All sales were on credit and accounts receivable decreased by
$1,040 in 2018 compared to 2017. Merchandise purchases were...
Booster Company is preparing its financial statements for the
year ended June 30, 2018. The financial statements are complete
except for the statement of cash flows. You have been asked to
prepare a statement of cash flows for the year ended June 30,
2017.
Booster Company A1 Company Facts:
PLEASE FILL IN THE BELOW CHARTS FOR THE
ASSIGNMENT:------------------------------------------------------------------
Account Balances June 30, 2017 June 30, 2018 Debits $ $ L 361,700 100,000 11,700 1,500 168,750 45.000 Cash Accounts Receivable Marketable...
XS Supply Company is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized: Current Year Previous Year Balance sheet at December 31 Cash Accounts Receivable Inventory Equipment Accumulated Depreciation-Equipment Total Assets Accounts Payable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings Total Liabilities and stockholders' Equity Income Statement Sales Revenue Cost of Goods Sold other Expenses Net...
Most questions answered within 3 hours.
-
A diamond's index of refraction for red light, 656 nm, is 2.410,
while that for blue...
asked 1 minute ago -
Compare HPLC, SPE, and GC. Identify the differences, the
advantages, and the weaknesses of each method.
asked 2 minutes ago -
Characteristic x-rays emitted by potassium have a wavelength of
0.374 nm. What is the energy of...
asked 4 minutes ago -
there is a function to create two random numbers between 1 and
25 and a function...
asked 23 minutes ago -
At a certain temperature, the ?pKp for the decomposition of
H2SH2S is 0.832.0.832.
H2S(g)↽−−⇀H2(g)+S(g)H2S(g)↽−−⇀H2(g)+S(g)
Initially, only...
asked 16 minutes ago -
Part 1.C&A Fast Food has four activities in serving a
customer: greet customer, take order, process...
asked 23 minutes ago -
Which attribute allows you to specify a custom "thumbnail" for
multimedia elements?
asked 1 hour ago -
How much 0.1200 M sodium hydroxide solution is need to titrate
14 mL of a 0.100...
asked 37 minutes ago -
An impulse is a change in momentum usually over
a short time. For which of the...
asked 41 minutes ago -
1a)When a 5000-kg roller coaster train full of riders approaches
the loading dock at a speed...
asked 1 hour ago -
The Poseidon Swim Company produces swim trunks. The average
selling price for one of their swim...
asked 57 minutes ago -
If the elasticity of supply of a good is ∞, then its
A. supply curve is...
asked 43 minutes ago