Download Starbucks 10K for fiscal year 2013 (that is, the year ended September 29, 2013).

a. Review the revenue recognition policies of Starbucks discussed in Note 1 (Summary of Significant Accounting Policies). Does Starbucks record revenue when they receive cash from their customers (cash-basis accounting) or do they follow a different rubric (for example, accrual accounting)? How does Starbucks record revenue on stored value cards (i.e., gift cards)? What challenges in measuring revenue do you observe? That is, are there any significant judgments management needs to make in recording sales revenues at Starbucks?

b. What are Starbucks' major expenses?

c. Were there any significant changes in the cost structure during the most recent year?

d. In fiscal 2013, Starbucks separately reported a litigation charge included it in operating income. Why didn't the company just include this amount within the line item for general and administrative expenses? Why is it an operating expense?

e. Was the company profitable during 2013? During 2012? Explain your definition of profitable.

f. Refer to Starbucks fiscal 2013 statement of cash flows:

a. Compare Starbucks net earnings to cash provided by operating activities and explain the difference.

b. How much cash did Starbucks use for expenditures for property, plant and equipment during fiscal 2013?

c. What amount of dividends did Starbucks pay during the year? How does this amount compare to the amount of dividends declared as shown in the statement of equity? g. Several notes to the financial statements refer to the use of estimates. Which accounts on Starbucks balance sheet require estimates? Are any accounts estimate free?