This chapter defined and discussed accrual transactions. Complete the following requirements using the most recent financial statements available on the Internet for Netflix, Inc. Obtain the statements by following the steps below. (Be aware that the formatting of the company’s website may have changed since these instructions were written.)
1. Go to www.netflix.com.
2. Click on “Investor Relations,” which is at the bottom of the page in very small print.
3. Click on the “Annual Reports and Proxies” link at the left side of the page.
4. Click on the “20xx Annual Report.” Use the .pdf version of the annual report.
5. Find the company’s balance sheet and complete the requirements below. In recent years, this has been shown toward the end of the Form 10-K section of the company’s annual report, around page 40. The “Index” near the beginning of the report can help you locate the financial statements.

Required
a. Make a list of all the accounts on the balance sheet that you believe are accrual type accounts.
b. What was Netflix’s net income for the year?
c. Did the balance in Netflix’s retained earnings increase or decrease from the end of last year to the end of the current year, and by what amount?
d. Prepare a short schedule that shows why the balance in retained earnings changed from last year to the current year. Think about what causes retained earnings to change.