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Starbuck

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Running Head: STARBUCK
Starbuck Corporation
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STARBUCK 10
A. Accounts receivables
Horizontal Analysis
1. Use basic financial analysis to examine any horizontal changes in Starbucks’
accounts receivable balances over time.
Millions
October
01
October 02
Amount
Percentage
Increase/
2017
2016
Increase/(Decrease)
(Decrease
Accounts receivable, net
870.4
768.8
$ 102
13.22%
Based on the horizontal analysis with 2016 as the base year, the accounts receivable
increases by $102, which is a change of 13.22%. The difference is an indication that Starbuck in
2017 had a weak credit policy especially in the collection of debts.
2. Vertical changes in the accounts receivable
(in millions, except per share data)
Oct-01
Oct-02
Percentage
2017
2016
Accounts receivable, net
870.4
769
5.37%
The vertical analysis of the accounts receivables is dependent on the total assets for the
financial year under evaluation. According to Starbucks Corporation-Form 10-K (2017), the total
accounts receivables making up the total assets of the business in 2016 is 5.37% whereas that for
2017 is 6.06% which is an increase thereby indicating that the company has a poor debt
collection policy for the financial year ending 2017 October.
3. Company methods of accounting and evaluation of receivables

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Running Head: STARBUCK Starbuck Corporation Name Institution Date STARBUCK 10 A. Accounts receivables Horizontal Analysis 1. Use basic financial analysis to examine any horizontal changes in Starbucks’ accounts receivable balances over time. Millions October 01 2017 Accounts receivable, net 870.4 October 02 Amount 2016 Increase/(Decrease) Percentage Increase/ (Decrease $ 13.22% 768.8 102 Based on the horizontal analysis with 2016 as the base year, the accounts receivable increases by $102, which is a change of 13.22%. The difference is an indication that Starbuck in 2017 had a weak credit policy especially in the collection of debts. 2. Vertical changes in the accounts receivable (in millions, except per share data) Oct-01 Change 2017 Accounts receivable, net 870.4 Oct-02 Percentage 2016 6.06% 769 5.37% The vertical analysis of the accounts receivables is dependent on the total assets for the financial year under evaluation. According to Starbucks Corporation-Form 10-K (2017), the total accounts receivables making up the total assets of the business in 2016 is 5.37% whereas that for 2017 is 6.06% which is an increase thereby indicating that the company has a poor debt collection policy for the financial year ending 2017 October. 3. Company methods of accounting and evaluation of receivables STARBUCK 10 The business accounts for its receivables after deducting the allowance for the bad and doubtful debts. Starbucks tries to avoid having its ...
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