Business Analysis Part Ii: Apple, Inc.
Business Analysis Part II: Apple, Inc.
MGT/Management 521
February 27, 2012
Apple, Inc. is appears to be a successful billion-dollar corporation, this analysis will focus on the financial health of this organization. In this analysis of Apple’s business environment focus will be placed on the income statement, balance sheet, and cash flow. A comparative analysis will be conducted to that of its top competitors.
Financial Health
In any organization whether it is a large global corporation or a small business, financial management is very important to keep a checks and balance of the organization in order to maintain a stable, profitable business. To determine the financial health of a business, you must look at three key financial statements: the balance sheet, income statement, and cash flow (Nickels, McHugh, & McHugh, "Chapter 17 Understanding Accounting and Financial Information," 2010). Performing a ratio analysis will show how Apple is performing compared to its competitors.
Income Statement
According to Apple’s annual income statement, their total revenue as of September 24, 2011 was $108 billion; gross profit was $44 billion. Their reported net income was $26 billion, which was a 53 percent increase. According to Apple’s income statement, they were profitable in 2011 ("Nasdaq", 2012).
Balance Sheet Apple’s reported “Total Assets” as of September 2011 were in excess of $116 billion while “Total Liabilities” were $39 billion. The “Total Equity” reported by Apple was $77 billion in which $62 billion were retained in the company ("Nasdaq", 2012).
Cash Flow Statement Apple’s net cash flow from operations are $37 billion with investing cash flows at a negative $40 billion and financing activities at $1 billion negative $1 billion ("Nasdaq", 2012). Apple’s cash balance at the beginning of the period was $11 billion and fell to $10 billion at the end of the period ("Apple Cash Flow", 2009-2012).
Summary of Financial Health
MGT/Management 521
February 27, 2012
Apple, Inc. is appears to be a successful billion-dollar corporation, this analysis will focus on the financial health of this organization. In this analysis of Apple’s business environment focus will be placed on the income statement, balance sheet, and cash flow. A comparative analysis will be conducted to that of its top competitors.
Financial Health
In any organization whether it is a large global corporation or a small business, financial management is very important to keep a checks and balance of the organization in order to maintain a stable, profitable business. To determine the financial health of a business, you must look at three key financial statements: the balance sheet, income statement, and cash flow (Nickels, McHugh, & McHugh, "Chapter 17 Understanding Accounting and Financial Information," 2010). Performing a ratio analysis will show how Apple is performing compared to its competitors.
Income Statement
According to Apple’s annual income statement, their total revenue as of September 24, 2011 was $108 billion; gross profit was $44 billion. Their reported net income was $26 billion, which was a 53 percent increase. According to Apple’s income statement, they were profitable in 2011 ("Nasdaq", 2012).
Balance Sheet Apple’s reported “Total Assets” as of September 2011 were in excess of $116 billion while “Total Liabilities” were $39 billion. The “Total Equity” reported by Apple was $77 billion in which $62 billion were retained in the company ("Nasdaq", 2012).
Cash Flow Statement Apple’s net cash flow from operations are $37 billion with investing cash flows at a negative $40 billion and financing activities at $1 billion negative $1 billion ("Nasdaq", 2012). Apple’s cash balance at the beginning of the period was $11 billion and fell to $10 billion at the end of the period ("Apple Cash Flow", 2009-2012).
Summary of Financial Health
References: Nickels, W.G., McHugh, J.M., & McHugh, S.M. (2010). Understanding Business (9th ed.). NASDAQ. (2012). Retrieved from http://www.nasdaq.com/symbol/aapl/financials Apple Cash Flow. (2009-2012). Retrieved from http://ycharts.com/financials/AAPL/cash_flow_statement/annual http://logisticsviewpoints.com/2011/07/06/does-apple-look-to-google-microsoft-and-rimm-for-best-practices/ Apple and the Environment. (2012). Retrieved from http://www.apple.com/environment/ Nosowitz, D. (May 26, 2010). Microsoft 's and Apple 's Product Lines Compared: This is why apple Wins. Retrieved from IBM Industry Frameworks. (n.d.). Retrieved from https://www-304.ibm.com/partnerworld/wps/servlet/ContentHandler/isv_com_ind_frameworks_prodserv Lashinsky, Sr, A. (January 18, 2012). The secrets Apple keeps. Retrieved from http://tech.fortune.cnn.com/tag/apple-management/ Marsal, K. (June 23, 2009). report details Apple 's unusual veil of secrecy. Retrieved from http://www.appleinsider.com/articles/09/06/23/report_details_apples_unusual_veil_of_secrecy.html Supplier Code of Conduct. (2012). Retrieved from http://www.apple.com/supplierresponsibility/code-of-conduct/ The story behind Apple 's environmental footprint. (2012). Retrieved from http://www.apple.com/environment/