Analyzing Amazon

Anonymous
timer Asked: Oct 16th, 2018
account_balance_wallet $15

Question Description

Resources: Analyzing Amazon document.

Write a 700- to 1,050-word paper.

The incredible growth of Amazon.com has put fear into the hearts of traditional retailers. Amazon's stock price has soared to amazing levels. However, it is often pointed out in the financial press that it took the company several years to report its first profit.

Calculate free cash flow for Amazon for the current and prior years.

Evaluate its ability to finance expansion from internally generated cash.

Thus far, Amazon has avoided purchasing large warehouses. Instead, it has used those of others. It is possible, however, that in order to increase customer satisfaction, the company may have to build its own warehouses. If this happens:

  • Describe how your impression of its ability to finance expansion change.
  • Project any potential implications of the change in Amazon's cash provided by operations from the prior year to the current year.

Tutor Answer

EXMenWriter
School: UC Berkeley

Attached.

Running head: AMAZON

1

Analyzing Amazon

Name

Instructor

Course

Date

AMAZON

2

$ in Millions

Current Year

Prior Year

Current assets

$ 31,327

$ 24, 625

Total assets

$ 54,505

$ 40,159

Current liabilities

$ 28,089

$ 22,980

Total liabilities

$ 43,764

$ 30,413

Cash earned from the

$ 6,842

$ 5,475

$ 4,893

$ 3,444

Net income

$ (241)- loss

$ 274

Sales

$ 88,988

$ 74,452

operation
Capital expenses
Paid dividends

Cash Flows = Cash earned from Operations - Capital Expenses – Paid Dividends
In the case of Amazon,
Cash flows for current year = 6, 842- 4,893
= $ 1,949
Cash flows for prior year = 5,475-3,444
= $ 2,031
In the online retail, Amazon is a dominant player (Ipeirotis, 2010). Even at the
expense of profits, it is best known for its persistent pursuit of market share and sales. The in-

AMAZON

3

progress capital expenditures investments to reinforce steady expansions of business can put
pressures on profits (earnings) after raising costs. The ever-increasing expenditures on the
research and development by the company to promote the Amazon brand and innovations
could make its earning scenarios more difficult (Rit...

flag Report DMCA
Review

Anonymous
Goes above and beyond expectations !

Similar Questions
Hot Questions
Related Tags
Study Guides

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors