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Investor Information
Financial statements are the primary way for an investor, creditor, and other financial statement users to evaluate a company's financial performance, financial stability, profitability, and net worth to determine whether putting investments in the company would provide profitability and adequate return on investments (Way, 2013). Financial statements are also a way for managers to communicate achievements in performance to potential investors and creditors. The various statements brings various information components in the determination of evaluating companies for potential investments.
In evaluating Apple, Inc., the Income Statement shows net income for 2012 at $41,733 million (Form 10-K, 2012), up from $25,922 million in 2011. The income statement reports sales, expenses, and profits or losses. This is important to an investor because it shows results from operations in how profitable a company has been for the particular period. By evaluating present results against past performance, investors...
It also helps an investor evaluate for changes in operations, what caused the changes, and whether changes were justified.
Apple's stockholder's equity for 2012 ended at $118,210 million, up from $76,615 million in 2011 (Form 10-K, 2012). The stockholder's equity is the net worth of the company. Apple, Inc. is showing an increase in net worth from 2011 to 2012. This information is particularly useful to a labor union because it shows that Apple, Inc. has the ability to give adequate raises every year and ensure payment of benefits to labor union employees at Apple, Inc. A labor union may use this information to advocate for more benefits and higher pay for union employees employed at Apple, Inc.
Apple, Inc. is showing total assets for 2012 at $176,064 million, up from $116,371 million for 2011 (Form 10-K, 2012). This information is particularly useful to creditors because it shows the liquidity of Apple, Inc. The liquidity shows the ability of the company to…
Bibliography
Form 10-K. (2012, Sept 29). Retrieved from Apple, Inc.: http://files.shareholder.com/downloads/AAPL/25...21359901x0xS1193125-12-444068/320193/filing.pdf
Way, J. (2013). What is the importance of a company's financial statements? Retrieved from Chron: http://smallbusiness.chron.com/importance-companys-financial-statements-21332.html
Financial Statement Differentiation Analysis of the Use of Four Types of Financial Statements The four fundamental types of financial statements include the balance sheet, income statement, statement of retained earnings and statement of cash flows and each meets a very specific series of needs within a business. Investors are most interested in the risk profiles of companies they are interested in investing in more than any other information element. Creditors are most
Financial Statements Identify the four basic financial statements. The four basic financial statements include: the balance sheet, income statement, owners' equity and cash flows. The balance sheet is when there is a focus on the current financial strengths or weaknesses inside a firm. This gives managers, employees, investors and regulators the ability to determine what issues are impacting the company. (Ingram, 2011) ("Four Financial Statements," 2010) The income statement is concentrating on the
Financial Statements All publicly-traded firms are required to produce financial statements. These statements are produced according to standardized guidelines, and their production is an essential component to the efficient function of modern capital markets in the west. This paper will discuss the nature of financial accounting statements, and will provide insight into how these statements provide a benefit to different stakeholder groups, both internal and external. The production of consistent, reliable financial
Financial Statements Conceptual Frameworks and Financial Statements It has been said that financial statements provide comprehensive information about the reporting entity that is useful to existing and potential stakeholders. While that is generally considered to be true, it is important to address what makes it true. Financial statements are created by the company to which the financial information belongs, so there is some concern that these might not be as accurate
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...,"
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,