Trident BUS500 2020 MAY Module 2 CASE & SLP Latest

BUS500 Financial Intelligence

Module 2 Case

BALANCE SHEET

Assignment Overview

The main purpose of this module is to review the balance sheet in more detail. Go to http://www.starbucks.com and click on the investor relations link. Locate the annual reports for the past two years. Review Starbucks’ financial report, review background material, and do additional research as needed to write an essay where you incorporate answers to the questions below.

IBISWorld is a proprietary database providing industry research. It is accessible via the Trident Online Library, Additional Library Resources. The database is found under additional library resources and offers a lot of interesting industry information including financial information.

Case Assignment

Questions

Go to the IBIS database and find information for coffee store franchises in the US Specialized Industry iExpert Summaries. Add three facts about the industry and comment on the information relative to Starbucks.

Distinguish between an expense (expired cost) and an asset.

Distinguish between short-term and long-term assets.

Distinguish between short-term and long-term liabilities.

Review Starbucks’ balance sheet and provide two examples of each of the above categories (short-term assets, long-term assets, short-term liabilities, and long-term liabilities).

How much debt does Starbucks have? Is the amount of debt high? How do we know if it is considered high? (Hint: Find financial information in IBIS World.)

Discuss retained earnings and how income or loss and dividends affect this account. Review Starbucks’ retained earnings account and explain how it changed during the past two years. Show details.

What is the difference between an annual report and a 10-k? Do companies have to publish both reports? Does Starbucks publish both?

Who were the auditors for the financial statements?

Assignment Expectations

Incorporate responses to the questions above in an organized format. Start with an introduction and end with a conclusion/summary. Use headings and subheadings to organize the essay. Do not forget to include references in APA format. The suggested length is five to seven pages.

BUS500 Financial Intelligence

Module 2 SLP

BALANCE SHEET

Below find a balance sheet for VWV Company.

VWV Company

Balance Sheet

December 31, 20XX

Assets

Liabilities

Current assets

Current liabilities

Cash

$72,000

Accounts payable

$32,000

Accounts receivable

28,000

Interest payable

8,000

Interest receivable

1,000

Inventory

66,000

Total current assets

$167,000

Total current liabilities

$40,000

Long-term assets

Long-term liabilities

Equipment (net of depreciation)

$128,000

Note payable

100,000

Total long-term assets

$128,000

Total long-term liabilities

$100,000

Equity

Common stock

10,000

Paid-in capital

50,000

Retained earnings

95,000

Total equity

$155,000

Total assets

295,000

Total liabilities and equity

$295,000

                                                                                                                                                                 

Required:

Recreate the balance sheet in an Excel spreadsheet. Use cell formulae to add and subtract numbers. Add a column next to the balance sheet for answers to the questions listed below.

Questions:

Is accounts payable larger or smaller than accounts receivable? What is the difference? What do the numbers indicate? Explain.

What does "equipment net of depreciation" mean?

Are payables short-term or long-term?

Determine total liabilities.

Determine net short-term assets or liabilities.

Determine the total amount owed by VWV at the end of the year.

How do we know that the above is a corporate (not a sole proprietor) balance sheet?

SLP Assignment Expectations

Submit the Excel spreadsheet. All information should be part of the spreadsheet. Written comments should be brief and refer to the balance sheet. Both content and presentation matter.