Purpose: Use a company’s annual report to identify the inventory method used and analyze the effects on the income statement and balance sheet.

Address: http://www.cisco.com (or go to www.wiley.com/college/kimmel)

Steps:

1. From Cisco System’s homepage, choose Investor information.

2. Choose View the Annual Report.

3. Use the financial statements and related notes to the financial statements to answer the questions below.

Instructions Answer the following questions:

(a) At Cisco's fiscal year-end, what was the net inventory on the balance sheet?

(b) How has its inventory changed from the previous fiscal year-end?

(c) What percentage of the inventory was finished goods? Find this answer in the notes to the financial statements.

(d) What inventory method does Cisco use?