Broadening Your Perspective 6-1 The notes that accompany a companys financial statements provide informative details that would clutter the amounts and descriptions presented in the statements. Refer to the financial statements of Apple Inc. are presented below. What did Apple report for the amount of inventories in its consolidated balance sheet at September 25, 2010? At September 24, 2011? (Enter your answers in millions.) September 24, 2011 September 25, 2010 Inventories $million $million Compute the dollar amount of change and the percentage change in inventories between 2010 and 2011. Compute inventory as a percentage of current assets at September 24, 2011. (Enter dollar amount in million. Enter all amounts as positive values. Round percentage answers to one decimal place, e.g. 15.2%.) Dollar change in inventories between 2010 and 2011 $ million decreaseincrease Percentage change in inventories between 2010 and 2011 % increasedecrease Inventory as a percentage change of current assets % How does Apple value its inventories? Inventories are valued at lowerhigher of cost or market. Which inventory cost flow method does Apple use? (See Notes to the Financial Statements.) Average-costFirst-in, first-out (FIFO)Last-in, first-out (LIFO) method. What is the cost of sales (cost of goods sold) reported by Apple for 2011, 2010, and 2009? (Enter your answers in millions.) Apple (in millions) 2011 2010 2009 Cost of Goods Sold $ $ $ Compute the percentage of cost of sales to net sales in 2011. (Round answer to 1 decimal place, e.g. 15.2%.) Percentage of cost of sales %

CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) ears ended September 24, 2011 2011 2010 2009 Cash and cash equivalents, beginning of the year Operating activities S 5,263 S 11,875 14,013 Net income Adjustments to reconcile net income to cash generated by operating activities: 25,922 Depreciation, amortization and accretion Share-based compensation expense Deferred income tax expense 1.168 2,868 879 1,040 Changes in operating assets and liabilities (939) 54 586 (713) (2,142) (596) Accounts receivable, net Inventories Vendor non-trade receivables Other current and non-current assets Accounts payable Deferred reve Other current and non-current liabilities 275 (1,934) (1,391) 2,515 1,654 4,495 37,529 6,307 1,217 778 18,595 nue 161 Cash generated by operating activities Investing activities (46,724) 19,790 10,888 Purchases of marketable securities Proceeds from maturities of marketable securities Proceeds from sales of marketable securities Payments made in connection with business acquisitions, net of cash acquired Payments for acquisition of property, plant and equipment Payments for acquisition of intangible assets (102317) 20,437 49,416 (57,793) 24930 21,788 (4.260) (3,192) (1,144) (2,005) (116) (175) (40419) 13.854)(17.434) Cash used in investing activities Financins activities 831 1,133 Proceeds from issuance of common stock Excess tax benefits from equity awards Taxes paid related to net share settlement of equity awards 475 270 (82) 663 751 (406) Cash generated by financing activities 1444 5,998 (Decrease)increase in cash and cash equivalents Cash and cash equivalents, end of the year Supplemental cash flow disclosure $ 9,815 S 5263 Cash paid for income taxes, net $ 3,338 S 2.697 S 2997