RESEARCH AND ANALYSIS USING THE ANNUAL REPORT Obtain FedEx Corporation’s 2007 annual report either through the ‘‘Investor Relations’’ portion of their website (do a web search for FedEx investor relations) or go to http://www.sec.gov and click ‘‘Search for company filings’’ under ‘‘Filings & Forms

(EDGAR).’’

Required:

Answer the following questions:

. How does FedEx apply the revenue recognition principle?

. With regard to the balance sheet and the income statement, what accounts may have required adjusting entries? Would these accounts require accruals or deferrals?

. How much did FedEx owe its employees for services performed at the end of the 2007 fiscal year?

. How much would FedEx credit to Income Summary for 2007? How much would be debited to Income Summary for 2007?

. How much did FedEx report as income tax expense for 2007? How much did FedEx report as cash paid for taxes for 2007? Why are the amounts different and where does this difference get reported on FedEx’s financial statements?

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