Activity 11 Purpose: ASSETS UNDERSTANDING THE BALANCE SHEET Identify the value at which amounts are reported on the balance sheet Understand what an increase or a decrease in an account indicates Develop strategies for analyzing the balance sheet STARBUCKS (SBUX) BALANCE SHEET (in millions) 9/28/2003 10/2/2005 Cash and cash equivalents $173.8 10/3/2004 $ 299.1 9/29/2002 $ 200.9 $ 99.7 Short-term investments 133.2 353.9 149.1 227.7 Accounts receivable 190.8 140.2 114.4 97.6 Inventories 546.3 422.7 342.9 263.2 Other current assets 165.2 135.0 102.7 84.4 Property, plant, and equipment 3,467.6 2.877.7 2.516.3 2,080.2 Accumulated depreciation (1.625.6) (1.326.3) (1.068.6) (814.4) PPE, net 1,842.0 1,551.4 1,447.7 1,265.8 Goodwill 92.0 69.0 63.3 19.9 Long-term investments 262.0 306.9 280.4 102.5 Other non-current assets 108.8 112.3 77.1 53.6 TOTAL ASSETS $3,514.1 $3.390.5 $2.778.5 $2,214.4 LIABILITIES Accounts payable $221.0 $199.3 $169.0 $136.0 Short-term debt 277.7 0.7 0.7 0.7 Other current liabilities 728.3 546.1 404.5 325.9 Long-term debt 2.9 3.6 4.4 5.1 Other non-current liabilities 193.6 166.4 128.8 (L) STOCKHOLDERS' EQUITY Contributed capital 130.4 996.1 998.5 930.4 Retained earnings 1,939.4 1,448.9 1,058.3 801.3 Other stockholders' equity TOTAL L & SE 20.8 $3.514.1 29.4 14.3 (9.0) $3,390.5 $2.778.5 $ (2) Q1 Use the balance sheet dated 10/2/2005 above to answer the following questions: b. C How much do customers owe this company? $ For inventories, $546.3 million is the (acquisition cost/current market value / book value / can't tell). For property, plant and equipment, net, $1,842.0 million is the (acquisition cost/current market value/book value/can't tell) What amount of investments does this company intend to hold for more than a year? d. S e million How much does this company owe to suppliers? $ Contributed capital amounts represent the (amount paid-in/market/book/present) value g. Starbucks is relying most heavily on (debt / contributed capital/retained earnings) to finance assets Interpreting and Analyzing Financial Statements 4 Page 16 Chapter 2-Balance Sheet