Description
Purpose of Assignment **NO PLAGIARISM**
This activity helps students recognize the significant role accounting plays in providing financial information to management for decision making through the evaluation of financial statements. This experiential assignment requires students to use ratios to evaluate and analyze a company's liquidity, solvency, and profitability.
Assignment Steps
Resources: Generally Accepted Accounting Principles (GAAP), U.S. Securities and Exchange Commission (SEC), University Library, Library resources: Company Directories and Financials
Tutorial help on Excel® and Word functions can be found on the Microsoft® Office website. There are also additional tutorials via the web offering support for Office products.
Select a publicly traded, U.S. corporation with which you are familiar or one where you currently work or have worked in the past.
Research the company on the Internet and download the Income Statement, Statement of Shareholders' Equity, Balance Sheet, and Statement of Cash Flows.
Develop a minimum 700-word examination of the financial statements and include the following:
- Determine the net income for the current fiscal year (FY). Is this income up or down from the prior year?
- Explain the relevance of changes in net income to investors.
- Determine the ending balance in shareholders' equity. Why would organizations such as labor unions be interested in this?
- Determine the total value of assets.
- Discuss the relevance of the total value of assets to potential creditors and why this is important.
- Compute the return on assets. Discuss the relative profitability of the company based on your results.
- Compute the working capital and current ratio. Evaluate the relative liquidity of the company based on your results.
- Compute the debt to assets ratio and the free cash flow for your company. Analyze the results and comment on the relative solvency of the company.
- Discuss how the financial statements are used in your current role or a position you would like to hold. How might these aid you in managerial decision making?
Show your work in Microsoft® Word or Excel®.
Complete calculations/computations using Microsoft® Word or Excel®.
Include the four financial statements along with your assignment.
Format your assignment consistent with APA guidelines.
Explanation & Answer
Please consider this one. I can help you with almost all assignments of UOP. Please let me know if you need further assistance. Thanks.
Financial Statements Analysis
•
Net Income
•
Shareholders' Equity
•
Total Value Assets
•
Return on Assets
•
Working Capital & Working Ratio
•
Debt to Assets Ratio & Free Cash Flow
•
Current Role
•
Conclusion
•
References
1
Financial Statements
ACC/561
July 27, 2017
2
Financial Statements
Financial statements give people a better understanding of how profitable or
nonprofitable an organization can be. There are individuals who do not understand this process
and can often wonder what organizations they should invest their money into. Microsoft is the
organization selected for this assignment.
“Microsoft is a technology company that supports the invention of, manufactures and
licenses goods and services related to computing” (Bellis, 2017, para, 1). The organization
Microsoft was founded through the relationship of Paul Allen and Bill Gates. The company
venture first opened in Japan in 1977. In 1981, Bill and Paul decided to move the organization to
Washington State, and the firm became known as Microsoft Inc. Over the next 30 years, the
company formed solid products and services by releasing different operating and gaming
systems, and the formulation of their first excursion into the hardware market by designing the
Microsoft Surface product line. Microsoft mission statement is “Our mission is to empower
every person and every organization on the planet to achieve more” (Microsoft, 2017).
Net Income
Microsoft current net income for the fiscal year 2017 is $21.2 million. When comparing
the current the fiscal year to the fiscal year 2016, net income has increased by $4.40 million. To
obtain a company net income, you take to total revenue and deduct the total number of expenses
to get the net income for the year. There are several reasons the increasing or decreasing in net
income is pertinent to investors. The first reason would be if the company is profitable and net
income continues to increase; investors will spend more money in the company. For example,
the net income will give a prediction on what the future of the organization will be in a few
years. If investors believe the company of the organization is profitable, the investors will buy
3
and sell stock at a higher price based on that prediction from the net income (Kimmel,
Weygandt, & Kieso, 2016). Creditors use the information in a similar way.
Shareholders' Equity
Shareholder’s Equity ...
Review
Review
