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Finanacial Statment Case 3-1

The Financial Statement Case at the end of each chapter uses theStarbucks Corporation 2013 Annual Report

In Financial Statement Case 3-1 (p. 179), you will examineStarbucks' financial statements to determine which accounts mighthave required adjusting entries. In addition you will review Note 1(Property, Plant, and Equipment) in the Notes to th ConsolidatedFinancial Statements.

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Nelly Stracke
Nelly StrackeLv2
29 Sep 2019

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Case 2.1 Intel Case The 2013 Intel Form 10-K can be found at the following Web site: www.pearsonhighered.com/fraser. Using the Form 10-K, answer the following questions: Prepare a common-size balance sheet for Intel for all years presented. Describe the types of assets Intel owns. Which assets are the most significant to the company? Using the notes to the financial statements, discuss the accounting methods used to value assets. What other information can be learned about the asset accounts from the notes? Have there been significant changes to the asset structure from 2012 to 2013? Analyze the accounts receivable and allowance for doubtful accounts. Describe the types of liabilities Intel has incurred. Which liabilities are the most significant to the company? Have there been significant changes to the liability and equity structure from 2012 to 2013? Describe the commitments and contingencies of Intel. Under which classification(s) are deferred taxes listed? What item is the most significant component of deferred taxes? What equity accounts are included on the balance sheet of Intel? Case 2.2 Applied Materials Comprehensive Analysis Case Using the Financial Statement Analysis Template Each chapter in the textbook contains a continuation of this problem. The objective is to learn how to do a comprehensive financial statement analysis in steps as the content of each chapter is learned. Using the 2013 Applied Materials Form 10-K that can be found at www.pearsonhighered.com/fraser, complete the following requirements: Open the financial statement analysis template that you saved from the Chapter 1 Applied Materials problem and input the data from the Applied Materials balance sheet. Be sure to read the notes to the financial statements to determine the correct numbers to input on the template. For example, the company has combined asset and liability accounts and property, plant and equipment has been recorded net of accumulated depreciation. See Note 7 to help you reorganize the data for the template. When you have finished inputting the data, review the balance sheet to make sure there are no red blocks indicating that your numbers do not match the cover sheet information you input from the Chapter 1 problem. Make any necessary corrections before printing out both your input and the common-size balance sheet that the template automatically creates for you. Analyze the balance sheet. Write a summary that includes important points that an analyst would use in assessing the financial condition of Applied Materials.

Using the Annual Report of Apple answer the following questions in the Discussion. Post the link to the statement with your discussion post. You may use a service such as Yahoo Finance to help research industry averages. The notes to the financial statements will also be of use in answering the discussion questions. For many of the ratios in the discussion, you will need 2-3 years' worth of financial data. Here is a possible website to use for the annual report...http://investor.apple.com/secfiling.cfm?filingid=1628280-16-20309&cik=320193

What are adjusting entries and why are they necessary?

In your chosen company, which accounts might require adjusting entries?

Why is it unethical not to record adjusting entries when required? What difference does it make?

What is the purpose of an adjusted trial balance?

Before you begin this assignment, it will be helpful if you review

McDonald'sMcDonald's

Corporation

20152015

annual report

(https://www.sec.gov/Archives/edgar/data/63908/000006390816000103/mcd-12312015x10k.htm ).

McDonald'sMcDonald's

Corporation is the world's leading global food service retailer with more than 36,000 locations worldwide in more than 100 countries. The corporation operates and franchises

McDonald'sMcDonald's

restaurants, which serve menu items such as the Big Mac, Chicken McNuggets, and McFlurry desserts. In addition,

McDonald'sMcDonald's

also serves McCafe beverages and pastries.Read the requirements

LOADING...

.

Requirement 1. Where would

McDonald'sMcDonald's

Corporation report plant assets on its financial statements? How are plant assets reported and what is the value as of December 31,

20152015 ?

(Enter any amounts in millions, to the nearest tenth of a million, X.X, as shown in the financial statements.)

Plant assets are reported at

cost

on the

consolidated balance sheet.

The gross value of plant assets at December 31, 2015 is $

37,692.4

(in millions).

Requirement 2. Does

McDonald'sMcDonald's

Corporation depreciate its plant assets? How do you know? What is the depreciation method used and the useful lives?

A.

No,

McDonald'sMcDonald's

Corporation does not depreciate its plant assets. We know this because there is no difference between the cost and net value of the plant assets as shown on the consolidated balance sheet. This is reasonable given that the company's only category of plant assets is land, which is not depreciated. As such, no depreciation method is in use.

B.

Yes,

McDonald'sMcDonald's

Corporation depreciates its plant asset. We know this because information about depreciation can be found in the Notes to the Consolidated Financial Statement and an accumulated depreciation and amortization balance is shown on the consolidated balance sheet. The company use the straight-line method to depreciate assets with the following estimated useful lives: up to 40 years for buildings, the lesser of the useful lives of assets or lease terms for leasehold improvements, and three to 12 years for equipment.

C.

Yes,

McDonald'sMcDonald's

Corporation depreciates its plant asset. We know this because information about depreciation can be found in the Notes to the Consolidated Financial Statement and an accumulated depreciation and amortization balance is shown on the consolidated balance sheet. The company use the double-declining-balance method to depreciate assets with the following estimated useful lives: up to 30 years for buildings, five to 10 years for leasehold improvements, and three to 12 years for furniture and equipment.

D.

Yes,

McDonald'sMcDonald's

Corporation depreciates its plant asset. We know this because information about depreciation can be found in the Notes to the Consolidated Financial Statement and depreciation expense is reported on the consolidated statement of income. The company use the double-declining-balance method to depreciate assets with the following estimated useful lives: up to 40 years for buildings, the lesser of the useful lives of assets or lease terms for leasehold improvements, and three to 12 years for equipment.

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