Note: Sample below may appear distorted but all corresponding word document files contain proper formattingExcerpt from Term Paper:
The fourth financial statement, called a "statement of shareholders' equity," shows changes in the interests of the company's shareholders over time. ("Beginners' Guide...," 2007)
To be considered profitable, a company's assets must equal, or "balance" the sum of its liabilities and shareholders' equity. Assets = Liabilities + Shareholders' Equity the following formula summarizes what a company's balance sheet pictures, followed by figure 5, which depicts this particular formula. ("Beginners' Guide...," 2007)
Figure 5: Formula Summarizing Balance Sheet (adapted from "Beginners' Guide...," 2007)
The following figure (6) presents a picture of locations of Costco's 529 warehouses, as of December 2007:
Figure 6: Locations of Costco's 529 Warehouses (Hanacek. 2008)
Financial figures presented during the course of this study relate and reinforce Costco's continuing history of making a profit from its sales. In addition, numerous publications reveal Costco's continuing growth in its number of warehouses; employee; cardholders; etc.. In turn, this researcher purports that the financial factors relating to Costco reveal a positive, profitable picture of a company that through caring for its customers, as Hudson (2007) contends, presents a "model with a success that outstrips competitors, including its chief rival, Wal-Mart Stores Inc.'s Sam's Club."
No one financial statement tells the complete story."
Beginners' Guide...," 2007)
As this segment's introductory quote purports, no single financial statement reveals a company's entire story. A combination of financial statements, albeit, provide vital information for investors. In turn, information retrieved from financial statements proves to be investor's best tool when he/she makes investment decisions. ("Beginners' Guide...," 2007)
When combined, a number of financial statements, as Costco's financial statements for the five years presented in this study reflect, they, as this researcher initially proposed to do, reveal a picture of the company.
That picture, consequently tells a company's story, as the one in this study tells the story of Costco. Hoff noted earlier in this study that due to the dearth of better options as fewer buyers shop at malls and other retail stores, numerous clothing companies recently decided to lower their prices and sell at Costco.
Selling their products at lower prices adds up to be more profitable than not selling them. In turn, Costco passes on lower prices to its customers, giving them a good "deal."
Galanti contends that consumers are just now beginning to realize with Costco, as with other companies, that increasing commodity costs, as well as, rising general merchandise costs will continue to cost more than previously seen, other than with gasoline. (D' Innocenzio, 2008) Higher energy costs not only adversely impact Costco's gas operations, but also affect freight costs of distributing merchandise. In turn, profits for the fourth quarter ending August 31, 2008 are expected to be "well below" the estimate of analysts Thomson Financial polled - $1 per share for the fourth quarter. "Costco's shares fell almost 12%, or $8.57, to close at $63.43." Costco plans to report 2008 fourth-quarter and fiscal year results October 8, 2008. (D' Innocenzio, 2008) at this time, more figures will contribute to Costco's projected future profit potential.
Everything One Needs to Know About Costco?
From a "finance" perspective, in regard to a company's past, present and future, some financial experts purport, when one utilizes the combination of financial statements, he/she can know everything one needs to know about a company such as Costco.
This researcher, however, proposes, that even a combination of financial statements may not be enough to know and/or predict a company's future story.
As Galanti stressed earlier in this study, however, "Everybody still likes a deal." (Harris, 2008)
This researcher projects that as a result of Costco's concentrated care for consumers and its practice of continually offering them "deals" in clothing and other areas, barring unforeseen, unnatural "acts of God" and/or nature, Costco, despite temporary set-backs, will likely continue to show profit in its financial statements. Consequently, the picture future financial statements of this company will likely continue to reflect its story by, as it does even today, permitting the figures to speak for themselves.
Beginners' Guide to Financial Statements." U.S. Securities and Exchange Commission; Modified: 02/05/2007. Retrieved July 27, 2008, at http://www.sec.gov/investor/pubs/begfinstmtguide.htm.
The Costco formula continues to resonate." MMR, May 5, 2008. Retrieved July 27, 2008, at http://www.highbeam.com/doc/1G1-179241204.html.
D&apos, Anne; Innocenzio. "Costco sees 4Q below estimates," AP Online, July 23, 2008. Retrieved July 27, 2008, at http://www.highbeam.com/doc/1A1-D923QE800.html.
Financial Statements. (2008) Costco Wholesale Corporation (NASDAQ:COST). Retrieved July 27, 2008, at http://finance.google.com/finance?fstype=ii&q=NASDAQ:COST.
Hanacek, Andy. "On the mark: more than 20 years after the launch of its meat and deli department, Costco Wholesale continues to meet the needs of its customers above all else." The National Provisioner, April 1, 2008. Retrieved July 27, 2008, at http://www.highbeam.com/doc/1G1-177636125.html
"Financial Statements Of Costco Wholesale" (2008, July 30) Retrieved October 25, 2016, from http://www.paperdue.com/essay/financial-statements-of-costco-wholesale-28716
"Financial Statements Of Costco Wholesale" 30 July 2008. Web.25 October. 2016. <http://www.paperdue.com/essay/financial-statements-of-costco-wholesale-28716>
"Financial Statements Of Costco Wholesale", 30 July 2008, Accessed.25 October. 2016, http://www.paperdue.com/essay/financial-statements-of-costco-wholesale-28716
As a result, this shift would lead to an emphasis on providing various goods and services to customers, in an effort to address changing consumer demand. This would have an impact on the Costco itself, as it would provide stability for the company and help them to be able to take advantage of the shift that was occurring. Evidence of this can be seen by examining the different financial aspects
Wal-Mart: Financial Statement Analysis WAL-MART FINANCIAL STATEMENT ANALYSIS Company Description Wal-Mart Stores Inc. (WMT) is a world largest grocery chain and retail stores. The company operates 8000 stores across three business segments which include apparel, groceries, electronics and small appliances. While the company operates globally, half of the company stores are located in the United States. To complete in the international markets, Wal-Mart also operates its business through subsidiaries in Canada, Argentina, China,
Costco The case notes that Costco's mission is "bringing the highest quality goods at the lowest possible prices while providing excellent customer service and adhering to a strict code of ethics…" and then the mission outlines the code of ethics. The company's operations clearly stick to this mission statement. This is possible because the mission statement is clear, and it specifically relates to what the company does. It hits upon a
Costco Corporation Statement of Ethics Our Mission is to offer our members quality goods and services at the lowest possible prices (Data monitor, 2011). In order to realize our mission, we will execute our business with the following Code of Ethics in mind: Code of Ethics Our code of ethics will focus on five critical elements: Taking care of our members Obeying the law Taking care of our employees Respecting our suppliers Rewarding our shareholders The achievement of the first
Indeed, the retailer's current ratio has not exceeded 1.0 in recent times. It is however important to note that given its profitability, it is likely that Wal-Mart converts its inventory into cash at a rate that is much faster than that of its peers in the same industry. For this reason, it is highly unlikely that in the normal course of doing business, the retailer could encounter challenges paying
The company's suppliers are one of the most important aspects of the microenvironment of any company, and Costco makes no exception. The company's suppliers can create a series of negative situations if they do not deliver the goods in time. This creates a chain of complaints that the company cannot resolve. Also, a good relationship between the company and its suppliers on the long-term can bring a series of benefits
Wal-Mart Financial Analysis Wal-Mart Store Inc. is a multinational retailer corporation branded as Wal-Mart in 2008. Founded in 1962, Wal-Mart has now become one of the largest American corporations with chain of retail stores. Wal-Mart sells varieties of consumer goods such as consumer electronics, toys, automobiles, furniture, video games and several other consumers goods. Presently, Wal-Mart enjoys the patronages of 200 million customers per week making the company to record the